Edison Issues Outlook on Cohort (CHRT)

Oct 04, 2016, 07:57 ET from Edison Investment Research

LONDON, October 4, 2016 /PRNewswire/ --

Cohort continues to successfully execute on its strategy of building a specialist defence technical advisory company, with innovative, flexible and specialist subsidiaries able to focus on organic opportunities. Strategic acquisitions such as the recently acquired EID augment growth, and extend reach both technically and geographically. The combination is delivering increasing shareholder returns. Our fair value stands at 439p, implying significant potential for shareholders.

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We now calculate fair value as a simple average of a calendar year 2017 peer group based sum-of-the-parts (SOP) and a capped DCF. This currently provides an implied fair value of 439p, compared to 387p previously. That is equivalent to a 9% P/E ratio premium to the UK aerospace and defence peers. We believe this to be warranted as Cohort continues to deliver above-average returns and pursues its growth strategy.

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SOURCE Edison Investment Research