Oracle stock price target raised to $400 from $250 at Global Equities
Investing.com -- Morgan Stanley said the recent pullback in Kongsberg Gruppen shares has largely run its course, with valuation now closer to long-term averages even as the outlook remains mixed between its defence and maritime units.
The brokerage initiated coverage with an Equal-weight rating and a price target of NOK 270, implying about 10% downside from current levels.
It noted the stock has already de-rated by about 20% from its June peak, leaving it trading at 29 times forward earnings, a roughly 35% premium to the sector but in line with its 10-year average premium.
Kongsberg’s defence division, which accounts for the bulk of its earnings, is well positioned to benefit from rising European demand for air defence systems and missiles, where supply remains constrained.
The company holds about a 45% market share in European air defence and interest in its missile portfolio is six times higher than before the war in Ukraine. But Morgan Stanley said those drivers are now well understood by investors, limiting room for further consensus upgrades.
Whereas its maritime business faces a more challenging outlook. While aftermarket activity is expected to stay strong amid new regulations, original equipment sales are under pressure, with orders contracting 60% year-to-date.
Based on Morgan Stanley’s vessel tracker, consensus forecasts for 2027 maritime sales are too high, given a two-year lag between orders and deliveries and tight shipyard capacity.
With defence momentum priced in and maritime headwinds increasingly reflected in estimates, the bank said Kongsberg’s valuation now looks fair. It sees the stock supported by its strong shareholder base and balanced portfolio, but with limited scope for upside from here.