Jefferies analyst David Farrell has maintained their bullish stance on BAB stock, giving a Buy rating today.
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David Farrell has given his Buy rating due to a combination of factors centered on management continuity, strategic execution, and robust operating momentum. He views the planned retirement of CEO Sir David Lockwood at the end of 2026, together with the appointment of Harry Holt from the Nuclear division, as a well-managed transition that preserves the successful strategic direction established since 2020. Farrell emphasizes that Holt brings a track record of strong revenue and profit growth in Babcock’s largest business unit and is already well known to investors, which should reduce uncertainty and support confidence in the next phase of the company’s development.
Farrell also believes that Babcock has effectively moved beyond its turnaround phase and is entering a period where it can capitalize on a wider set of growth opportunities across all divisions, both in the UK and internationally. He highlights that the operational performance reported in the first half of fiscal 2026 has carried through into the third quarter, demonstrating sustained momentum rather than one-off improvement. Given this backdrop, Farrell sees potential for earnings in fiscal 2026 to exceed current market forecasts, reinforcing his positive stance on the shares and underpinning his Buy recommendation.
According to TipRanks, Farrell is a 5-star analyst with an average return of 11.8% and a 69.51% success rate. Farrell covers the Industrials sector, focusing on stocks such as Babcock International, Chemring, and FLSmidth & Co. A/S.
In another report released today, Berenberg Bank also reiterated a Buy rating on the stock with a p1,670.00 price target.