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U.K. (FTSE) Aerospace and Defense Industry Analysis

UpdatedMar 10, 2026
DataAggregated Company Financials
Companies13
  • 7D-4.7%
  • 3M17.2%
  • 1Y55.0%
  • YTDn/a

Over the last 7 days, the Aerospace and Defense industry has dropped 4.7%, driven by a pullback from Rolls-Royce Holdings of 8.5%. This takes the industry's 12 month performance to a gain of 55%. As for the next few years, earnings are expected to grow by 3.3% per annum.

Industry Valuation and Performance

Has the U.K. Aerospace and Defense Industry valuation changed over the past few years?

DateMarket CapRevenueEarningsPEAbsolute PEPS
Tue, 10 Mar 2026UK£190.4bUK£61.9bUK£8.5b27.2x22.5x3.1x
Thu, 05 Feb 2026UK£178.5bUK£59.4bUK£8.3b25x21.6x3x
Sat, 03 Jan 2026UK£172.1bUK£59.4bUK£8.3b23.3x20.8x2.9x
Mon, 01 Dec 2025UK£157.4bUK£59.4bUK£8.3b23.8x19x2.6x
Wed, 29 Oct 2025UK£173.2bUK£59.3bUK£8.3b25.2x21x2.9x
Fri, 26 Sep 2025UK£178.1bUK£59.3bUK£8.3b25.2x21.6x3x
Sun, 24 Aug 2025UK£159.1bUK£59.3bUK£8.3b24.9x19.3x2.7x
Tue, 22 Jul 2025UK£76.9bUK£38.7bUK£2.1b29.5x36.9x2x
Thu, 19 Jun 2025UK£75.9bUK£38.4bUK£2.0b28.7x37.5x2x
Sat, 17 May 2025UK£68.5bUK£38.4bUK£2.3b27x29.3x1.8x
Mon, 14 Apr 2025UK£63.0bUK£38.5bUK£2.3b23.9x26.9x1.6x
Wed, 12 Mar 2025UK£62.8bUK£38.5bUK£2.3b25.1x26.8x1.6x
Fri, 07 Feb 2025UK£50.9bUK£36.7bUK£2.2b19.2x22.7x1.4x
Sun, 05 Jan 2025UK£49.0bUK£36.7bUK£2.2b20x21.9x1.3x
Tue, 03 Dec 2024UK£52.6bUK£36.7bUK£2.2b20x23.7x1.4x
Thu, 31 Oct 2024UK£51.6bUK£36.3bUK£2.2b18.8x23.7x1.4x
Sat, 28 Sep 2024UK£50.8bUK£36.3bUK£2.2b20.2x23.3x1.4x
Mon, 26 Aug 2024UK£53.6bUK£36.3bUK£2.2b21.4x24.6x1.5x
Wed, 24 Jul 2024UK£53.6bUK£34.8bUK£2.1b21.8x25.5x1.5x
Fri, 21 Jun 2024UK£56.1bUK£34.8bUK£2.1b23.4x26.8x1.6x
Sun, 19 May 2024UK£56.4bUK£34.6bUK£2.1b23.7x27.2x1.6x
Tue, 16 Apr 2024UK£55.9bUK£34.7bUK£2.1b22.2x27x1.6x
Thu, 14 Mar 2024UK£54.0bUK£34.6bUK£2.1b21.9x26.1x1.6x
Sat, 10 Feb 2024UK£51.3bUK£38.5bUK£2.1b19.6x24.1x1.3x
Mon, 08 Jan 2024UK£57.4bUK£41.0bUK£2.2b25.2x26.2x1.4x
Wed, 06 Dec 2023UK£53.5bUK£40.9bUK£2.2b30.9x24.4x1.3x
Fri, 03 Nov 2023UK£54.9bUK£40.7bUK£2.2b29.4x25.2x1.3x
Sun, 01 Oct 2023UK£51.3bUK£40.7bUK£2.2b28.5x23.5x1.3x
Tue, 29 Aug 2023UK£51.6bUK£40.4bUK£2.0b24.2x26.1x1.3x
Thu, 27 Jul 2023UK£49.8bUK£39.1bUK£1.6b23.2x30.7x1.3x
Sat, 24 Jun 2023UK£49.6bUK£38.7bUK£1.8b22.8x27.5x1.3x
Mon, 22 May 2023UK£51.2bUK£38.6bUK£1.8b18.4x27.9x1.3x
Wed, 19 Apr 2023UK£45.7bUK£31.0bUK£2.1b17.6x22.1x1.5x
Fri, 17 Mar 2023UK£42.2bUK£31.0bUK£2.1b17.6x20.4x1.4x
Price to Earnings Ratio

20.4x


Total Market Cap: UK£42.2bTotal Earnings: UK£2.1bTotal Revenue: UK£31.0bTotal Market Cap vs Earnings and Revenue0%0%0%
U.K. Aerospace and Defense Industry Price to Earnings3Y Average 25.2x202420252026
Current Industry PE
  • Investors are pessimistic on the British Aerospace and Defense industry, indicating that they anticipate long term growth rates will be lower than they have historically.
  • The industry is trading at a PE ratio of 22.5x which is lower than its 3-year average PE of 25.2x.
  • The 3-year average PS ratio of 1.8x is lower than the industry's current PS ratio of 3.1x.
Past Earnings Growth
  • The earnings for companies in the Aerospace and Defense industry have grown 60% per year over the last three years.
  • Revenues for these companies have grown 26% per year.
  • This means that more sales are being generated by these companies overall, and subsequently their profits are increasing too.

Industry Comparison

How does U.K. Aerospace and Defense compare with similar industries?

GB Market-5.15%
Industrials-4.47%
Aerospace & Defense-4.70%
Aerospace and Defense-4.70%
Industry PEThere are no additional sub-industries under this industry.
Forecasted GrowthThere are no additional sub-industries under this industry.

Top Stock Gainers and Losers

Which companies have driven the market over the last 7 days?

CompanyLast Price7D1YValuation
BA. BAE SystemsUK£22.491.3%
+UK£853.6m		42.7%PE32.4x
RR. Rolls-Royce HoldingsUK£13.110.6%
+UK£634.1m		75.4%PE18.7x
BAB Babcock International GroupUK£14.172.7%
+UK£183.8m		100.3%PE24.6x
QQ. QinetiQ GroupUK£5.142.8%
+UK£70.9m		-0.2%PS1.4x
CHRT CohortUK£13.624.8%
+UK£28.4m		12.1%PE34.1x

Latest News

MRO
UK£5.36
Melrose Industries
7D
-1.0%
1Y
10.2%

MRO: Future Cash Returns Will Reflect Improved Earnings Visibility And Repriced Risk Premium

Analysts recently lifted their price target on Melrose Industries to £7.63 from £7.35, citing updated assumptions on discount rates, revenue growth, profit margins and future P/E expectations. Analyst Commentary Analysts lifting the price target to £7.63 suggests they see enough support in their updated assumptions on discount rates, revenue, margins and future P/E to justify a higher valuation range for Melrose Industries.
CHG
UK£5.40
Chemring Group
7D
1.1%
1Y
37.4%
SNR
UK£3.02
Senior
7D
2.2%
1Y
88.8%

SNR: Higher Fair Value Will Increase Execution Risk And Limit Upside

Analysts have raised their price target on Senior, with one recent move of £0.35 higher. This reflects updated views on fair value, revenue growth prospects, profit margins and the P/E they are comfortable paying for the shares.
BA.
UK£22.49
BAE Systems
7D
1.3%
1Y
42.7%

BA.: NATO Rearmament And US Contracts Will Support Measured Future Demand

Narrative Update on BAE Systems The analyst price target for BAE Systems has been raised from £21.49 to £22.90, reflecting higher Street targets, including recent increases from £19.50 to £24.00 per share, supported by updated assumptions for revenue growth, profit margins and a slightly adjusted P/E outlook. Analyst Commentary Street research on BAE Systems over recent months shows a mix of optimism on the earnings outlook and valuation support, alongside some caution on future share performance and relative appeal versus peers.
CHRT
UK£13.62
Cohort
7D
4.8%
1Y
12.1%
RR.
UK£13.11
Rolls-Royce Holdings
7D
0.6%
1Y
75.4%
QQ.
UK£5.14
QinetiQ Group
7D
2.8%
1Y
-0.2%

QQ.: Higher Discount Rate And Execution Risk Will Constrain Future Share Returns

Analysts have lifted their price targets on QinetiQ Group to about £5.65 per share, up from around £5.40. They cite updated assumptions on revenue growth, profit margins, a slightly higher discount rate, and a modestly lower future P/E multiple.
BAB
UK£14.17
Babcock International Group
7D
2.7%
1Y
100.3%

BAB: Long-Term Defence Contracts And New Partnerships Will Support Medium-Term Upside

Analysts have lifted their price target on Babcock International Group to about £15.46 from £13.08, reflecting updated assumptions around revenue growth, profit margins and future P/E expectations, despite a mix of recent rating changes across the Street. Analyst Commentary Bullish Takeaways Bullish analysts lifting price targets, including moves to levels such as £16.70, see scope for the shares to better reflect their updated assumptions on earnings and P/E.
MSI
UK£13.80
MS INTERNATIONAL
7D
8.2%
1Y
29.0%