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Investing.com - Kepler Cheuvreux upgraded Leonardo Spa (BIT:LDO) (OTC:FINMY) from Hold to Buy and raised its price target to EUR58.00 from EUR49.00 following the company’s H1 results. The upgrade comes as the prominent aerospace and defense player has delivered impressive returns, with the stock surging over 102% year-to-date and 129% over the past year.
The upgrade comes after Leonardo increased its guidance, raising its intake forecast by 7% and free operating cash flow (FOCF) forecast by 9%, according to Kepler Cheuvreux. InvestingPro data shows the company maintains a GOOD financial health score, with strong revenue growth of 14.68% in the last twelve months. Get access to 8 more exclusive ProTips and detailed financial metrics with InvestingPro.
Leonardo also announced the acquisition of IDV for EUR1.7 billion, a deal expected to close by the first half of 2026. The transaction values IDV at 12x EV/EBIT LTM and less than 10x including EUR30 million in targeted synergies, with ongoing negotiations with Rheinmetall (ETR:RHMG) potentially taking half of the military truck business.
The aerospace and defense company is implementing capacity boost initiatives and continues working to conclude a partnership for its Aerostructures division by the end of 2025.
Kepler Cheuvreux has raised its 2025 estimates for Leonardo, increasing order intake projections by 2.5% and FOCF by 8.1% to reflect the company’s guidance hike.
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