Balanced Operational Outlook but Constrained Upside: Rationale for Maintaining a Hold Rating

Chloe Lemarie, an analyst from Jefferies, maintained the Hold rating on Thales. The associated price target remains the same with €250.00.

Chloe Lemarie has given his Hold rating due to a combination of factors that balance operational strengths with lingering uncertainties. Management’s confirmation of 2025 targets for mid‑single‑digit organic growth, solid double‑digit margins, and strong cash conversion underlines a reassuring baseline, with particular confidence around Defence profitability above 13%. Aerospace continues to benefit from robust demand in avionics and aftermarket activity, and Space is still expected to edge up despite softer telecom sales, offering a supportive overall backdrop. However, Defence growth is still framed within high single digits without signs it can sustainably exceed this range, and the Q4 slowdown versus a tough comparison base tempers the near‑term growth narrative.
At the same time, the Cyber business remains in a transition phase: while sales trends are improving quarter over quarter and margins are being protected, the company has yet to demonstrate a clear return to top‑line expansion, which is now pushed out to 2026. Currency effects, a higher effective tax rate driven by French tax surcharges, and financial costs tied to interest and FX also constrain upside to earnings in the near term, even though they are broadly embedded in guidance. Taken together, these factors suggest a solid but not compelling risk‑reward profile at current levels, leading Lemarie to endorse the shares as a Hold rather than taking a more aggressive stance.

According to TipRanks, Lemarie is a top 25 analyst with an average return of 39.2% and a 92.71% success rate. Lemarie covers the Industrials sector, focusing on stocks such as Airbus Group SE, MTU Aero Engines, and Rheinmetall.