London, Feb 15, 2026, 13:20 GMT — Market closed
- Australia has earmarked additional funds for an AUKUS submarine shipyard, with BAE teaming up with ASC to handle construction.
- BAE shares finished up on Friday after a filing showed new buyback activity.
- Next up for investors: BAE is set to report its full-year numbers this week.
BAE Systems’ stock could draw fresh attention in London trading Monday, after Australia pledged A$3.9 billion ($2.76 billion) for construction work at a shipyard tied to the AUKUS submarine deal. “Investing in the submarine construction yard at Osborne is critical to delivering Australia’s conventionally-armed, nuclear-powered submarines,” Prime Minister Anthony Albanese said. The AUKUS pact, revealed in 2021, would see U.S. Virginia-class subs stationed in Australia from 2027, with sales to follow around 2030. Britain and Australia are set to develop a new class as well. A Pentagon review last December highlighted areas for bolstering the initiative. (Reuters)
The spending pledge is a key point for BAE, putting the spotlight back on those massive, multi-year programs that drive the company’s order book far beyond the next couple of quarters. Investors have shown little hesitation jumping into defense stocks when governments lay out plans for new budgets, ramp-ups, or production schedules—and this announcement lands right in that current.
Focus is zeroing in on BAE’s upcoming results. “Momentum has continued to build behind BAE Systems ahead of its full-year results next week,” Derren Nathan, head of equity research at Hargreaves Lansdown, said in a Friday note, flagging BAE’s Feb. 18 results date. (Hargreaves Lansdown)
BAE closed out Friday at 1,968 pence, up 2.23%, beating the FTSE 100’s 0.42% gain, according to MarketWatch data. Shares remain 8.85% off the 52-week high of 21.59 pounds from Jan. 19. Trading volume for the day hit 3.7 million shares—well below the 50-day moving average of 6.6 million. (MarketWatch)
BAE pushed ahead with its buyback program, according to a regulatory filing out Friday. The company snapped up 110,911 shares for cancellation, reducing its total share count. The purchase price landed at a volume-weighted average of 1,929.56 pence per share, factoring in trade sizes. (London South East)
Sector sentiment stayed positive. European defence stocks outperformed Friday, up 3.3%, buoyed by an 8.3% surge in Safran after the aerospace group raised its 2026 forecast and hit a record high, according to a Reuters market report. (Reuters)
Investors won’t be watching Friday’s numbers alone; the focus shifts to whether government promises actually show up as schedules, contracts, and real money hitting the income statement. BAE’s buybacks help cushion the daily volatility, but if project costs spiral, buybacks won’t fix execution issues.
The downside’s hard to miss here: big defence projects are prone to delays, and the AUKUS schedule stretches out, leaving room for political headwinds, design tweaks, and supply snags. If delivery speeds slow, cash conversion softens, or management offers hesitant guidance for 2026, the stock—already near its peak—could face pressure.
Traders are looking for new details on order intake, margins, and cash generation, plus any signals from management about ripple effects as production ramps up across several platforms. And with AUKUS activity picking up at Osborne, any related updates will get a close look—spending there has become a headline issue.
