London, July 7, 2026, 12:04 BST
- BAE Systems LON:BA slipped 0.1% to 2,023p, trading between 2,011p and 2,047p so far in delayed London action.
- The 2.2% gain on Monday outpaced the FTSE 100 Index (INDEXFTSE:UKX), which slipped 0.26%. Trading volume was still below the usual level.
- Edgewing’s £4.6 billion GCAP contract is about 15% of BAE’s 2025 headline sales, but the project is split with other partners.
- BAE will release its half-year results July 30.
BAE Systems plc LON:BA edged down 0.1% to 2,023p at 12:04 p.m. in London, based on 20-minute delayed quotes. Shares moved between 2,011p and 2,047p so far. The London Stock Exchange’s regular session runs from 8:00 to 16:30.
BAE climbed 2.2% to 2,025p on Monday, while the FTSE 100 Index (INDEXFTSE:UKX) slipped 0.26%. Trading was light, with just 4.1 million BAE shares moving, under the 50-day average of 6.6 million.
Europe’s defence names pulled back Tuesday, a shift after their rally earlier this month. The STOXX Europe defence index dropped, according to Reuters. Broader markets were steady, with the STOXX 600 Index (INDEXSTOXX:SXXP) ticking up 0.1% just before 0900 GMT.
The main question for investors is price. LSEG data pulled by Investors Chronicle puts the median 12-month target from 18 analysts at 2,333.5p, with the top end at 2,650p and the low at 1,700p. From 2,023p, the midpoint points to a 15.3% potential gain. The shares still trade about 14.3% under the 52-week high of 2,360p.
| BAE market read | Number | Move from 2,023p |
|---|---|---|
| Last price | 2,023p | — |
| Median analyst target | 2,333.5p | +15.3% |
| Highest analyst target | 2,650p | +31.0% |
| Lowest analyst target | 1,700p | -16.0% |
BAE kept its 2026 outlook unchanged in May. The group is still aiming for 7%-9% growth in sales, 9%-11% in underlying EBIT, 9%-11% in underlying EPS, and more than £1.3 billion in free cash flow. “We’ve delivered a strong start to 2026,” CEO Charles Woodburn said. Investegate
| Company guide | 2025 base | 2026 guide | Implied 2026 range |
|---|---|---|---|
| Sales | £30.7 billion | +7% to +9% | £32.85 billion-£33.46 billion |
| Underlying EBIT | £3.3 billion | +9% to +11% | £3.60 billion-£3.66 billion |
| Underlying EPS | 75.2p | +9% to +11% | 82.0p-83.5p |
| Free cash flow | not stated in guide table | above £1.3 billion | above £1.3 billion |
GCAP got a new order. The UK, Italy and Japan gave Edgewing a £4.6 billion contract to push forward the Global Combat Air Programme fighter jet. Reuters said BAE, Leonardo BIT:LDO, and Mitsubishi Heavy Industries TYO:7011 are working on the sixth-gen plane, which they aim to have ready by 2035. The British government said this contract comes after an £8.6 billion UK pledge over four years.
The £4.6 billion figure amounts to 15.0% of BAE’s expected 2025 sales, but this isn’t all BAE revenue. Edgewing projects split the business with Italy and Japan, and fighter work stretches over a long period. For shareholders, this is about building backlog, not a short-term boost to earnings.
BAE’s May update put £3.6 billion in sterling air awards on the table. About £2.5 billion came from Türkiye’s Eurofighter Typhoon support and about £1.1 billion from MBDA’s European orders. That pair makes up 11.7% of the 2025 sales base, even before BAE locks in dollar awards for space, artillery, air defence and naval.
The issue is delivery. Reuters said last week that concerns around defence firms’ ability to ramp up production have weighed on sentiment. KNDS pushed back its IPO, and Morningstar’s Michael Field called it “a terrible time to IPO.” Sash Tusa at Agency Partners pointed to continued worries about companies “underperforming in execution terms” even as they hold full order books and see good market potential. Reuters
BAE’s half-year results are out July 30, which is the next key date. Investors will be watching to see if order intake starts to show up in free cash flow, with the company guiding for over £1.3 billion. By May 6, BAE had finished £930 million of its £1.5 billion buyback, including £166 million bought back in 2026 up to that point.
