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Costain ( (GB:COST) ) has issued an announcement.
Costain has reached a new agreement on its defined benefit pension scheme that removes a long‑standing dividend parity constraint and eliminates the need for further cash contributions until 2031, freeing up capital to enhance shareholder returns. In light of a strong balance sheet, surplus in the scheme and robust trading in FY 25, the board intends to move to a 3.0x dividend cover policy that would almost double cash dividends in FY 26 and to launch a £20m share buyback next year, while continuing to review the capital structure for potential additional returns. Operationally, FY 25 performance is expected to be in line with market profit expectations, with adjusted operating margins exceeding the 4.5% target and year-end net cash of £190m ahead of consensus, supported by timing benefits in working capital. The company has also secured a series of significant long-term contracts, including a utilities delivery partner role for Sellafield worth up to £1bn over 15 years and major nuclear and highways work, underpinning management’s confidence in further progress in FY 26 and a ‘step change’ in performance from FY 27 onwards.
The most recent analyst rating on (GB:COST) stock is a Buy with a £177.00 price target. To see the full list of analyst forecasts on Costain stock, see the GB:COST Stock Forecast page.
Spark’s Take on GB:COST Stock
According to Spark, TipRanks’ AI Analyst, GB:COST is a Outperform.
Costain’s overall stock score reflects a strong financial foundation, positive technical indicators, and strategic corporate developments. The company’s stable financial performance and recent contract wins are significant strengths. However, modest profit margins and declining cash flow efficiency are areas for improvement. The valuation is fair, and the technical outlook is positive, supporting a favorable stock assessment.
To see Spark’s full report on GB:COST stock, click here.
More about Costain
Costain Group PLC is a UK-based infrastructure solutions company that delivers connected, sustainable projects across the transport, water, energy and defence markets. The group focuses on providing predictable, best-in-class engineering and construction services aimed at supporting a more prosperous, resilient and decarbonised UK.
Average Trading Volume: 880,529
Technical Sentiment Signal: Buy
Current Market Cap: £432.1M
For a thorough assessment of COST stock, go to TipRanks’ Stock Analysis page.