BAE Systems BA.L
BAE Systems is a British defense and aerospace company that designs, manufactures, and maintains military systems, including combat aircraft, armored vehicles, ships, and electronic systems, with recurring revenue from long-term government contracts. BAE Systems shows solid financial health with Net Debt/EBITDA of 1.32 and ROE of 18.63%, although its valuation (P/E 28.22) already discounts growth expectations. Revenue growth of 7.70% and free cash flow conversion of 78.29% support its defensive profile.
Detailed metrics
Market and fundamental data as of the analysis date.
Full AI report
Generated automatically from the metrics, the macro context and the company's news.
BAE Systems is a British defense and aerospace company that designs, manufactures, and maintains military systems, including combat aircraft, armored vehicles, ships, and electronic systems, with recurring revenue from long-term government contracts. BAE Systems shows solid financial health with Net Debt/EBITDA of 1.32 and ROE of 18.63%, although its valuation (P/E 28.22) already discounts growth expectations. Revenue growth of 7.70% and free cash flow conversion of 78.29% support its defensive profile.
Score by category
| Category | Score |
|---|---|
| Financial health | 6.2 |
| Quality / Moat | 5.7 |
| Valuation | 5.0 |
| Growth | 5.9 |
| Dividend | 4.7 |
| Momentum | 4.8 |
| Risk & Context | 8.9 |
OVERALL SCORE: 5.9/10
Context and risks
Exposure to geopolitical tensions in the Middle East that may affect defense demand, but also increase operating and supply chain costs. Rising oil pressures margins, though mitigated by long-term government contracts.
News considered in the analysis
- European Indexes Slide as Higher Oil Weighs on Defense Stocks, Banks — El repunte del crudo presiona los costes operativos y de combustible, aunque el impacto en BAE es limitado dado su modelo de contratos gubernamentales.
- 3 Defense Stocks Investors Are Watching As Middle East Risk Puts Aerospace In Focus — La tensión geopolítica en Oriente Medio puede incrementar la demanda de defensa, beneficiando a BAE Systems.
- Will This Major Industry Showcase Boost Quantum Computing Stocks? — Noticia genérica sobre computación cuántica sin relación directa con BAE Systems.
- Are Aerospace Stocks Lagging ATI INC (ATI) This Year? — Comparativa sectorial sin información nueva sobre BAE Systems.
- 3 British Undervalued Stocks For September 2026 — Listículo genérico sin información específica relevante.
Verdict: Hold positions; defense demand from geopolitical tensions is a catalyst, but valuation offers no margin of safety.
Main risk: Dependence on government defense budgets, which may face cuts or delays, and exposure to geopolitical tensions affecting costs and supply chain.
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