Broker tips: Entain, Made Tech, Persimmon, Babcock
By Iain Gilbert
Date: Thursday 26 Jun 2025
(Sharecast News) - Goldman Sachs upgraded Ladbrokes owner Entain on Thursday to 'buy' from 'neutral' and hiked its price target on the stock to 1,020.0p from 810.0p.
The bank pointed to joint venture BetMGM's potential to deliver returns. It also cited the fact that the stock trades at a significant discount to peers and its own history.
In addition, Goldman said it was increasingly confident in the transformation of BetMGM's profitability and its capacity for cash returns.
Canaccord Genuity initiated coverage on IT services firm Made Tech with a 55.0p target price and 'buy' rating on Thursday, stating the stock was "back for good".
Canaccord Genuity said Made Tech was a "nimble UK public sector DX market share gainer" that has organically grown sales ten times over the last six years, materially outperforming its end-market and most peers.
The Canadian bank stated that following some "growing pains" and a weak end-market in 2024, Made Tech has now "firmly found its footing again", with Thursday's FY25 trading update pointed to a sustained return to double-digit organic growth whilst beating consensus sales, profit and net cash expectations for the year, continuing the pattern of the last 12 months.
"Assuming Made Tech can continue to gain share of its +£3.0bn TAM and penetrate more high-spending government departments, such as Ministry of Defence, Department of Work and Pensions, His Majesty's Revenue and Customs and others, it could continue to grow at mid-teens percentage. On this trajectory, £100.0m in run-rate sales and £10.0m EBIT by 2030 would be a distinct possibility. On our estimates, this could drive the shares to 100.0p, more than three times current levels," said Canaccord Genuity.
JPMorgan has reiterated an 'overweight' rating for Persimmon, saying that the housebuilder's medium-term targets provide "significant" earnings and valuation potential.
The broker kept a positive recommendation on the stock with a 1,520.0p target price, suggesting further upside from Thursday morning's price of 1,304.5p, despite the shares having outperformed the sector over 2025 so far.
The stock has gained 14% over the year-to-date compared with the wider sector up just 10%, but is still down 5% since the Labour government came into power last summer despite the launch a host of planning changes to support housebuilding. As such, this still represents an "attractive opportunity for investors", according to JPM analyst Zaim Beekawa.
"As a reminder, Persimmon's mid-term objectives are to achieve 20% operating margins and ROCE; our scenario analysis indicates that, should Persimmon achieve these by 2029 (while continuing to grow the business), we could see earnings upside of 95%, while a simple correlation overlay of historical ROCE to historical P/TNAV, suggests upside of 45% to current valuation levels," Beekawa said.
The analyst also highlighted Persimmon's "unappreciated" vertical integration capabilities, such as the company using its own bricks, tiles and timber frames to save on build costs, along with the recent launch of its own shared equity products which differentiates it from competitors when it comes to affordability.
Analysts at Berenberg hiked their target price on aerospace and defence firm Babcock from 910.0p to 1,350.0p on Thursday, stating the group appeared to be "making waves below the surface".
Berenberg said Babcock's FY25 results reinforced its view that the company was "well positioned" to benefit from rising defence budgets in the medium and long term after management emphasised that there was "significant growth potential" beyond its three- to five-year medium-term guidance window.
The German bank noted that this included opportunities in the UK, as well as from its growing list of partnerships with international defence companies, which offer scope for an acceleration of revenue in the coming years.
Berenberg said the shares "screen attractively", trading on 22x price-to-earnings ratio for a 10% three-year earnings per share compound annual growth rate, in its view.
"We raise our FY26-28 EPS estimates by 4-9% as we incorporate the upgraded margin guidance and the £200.0m share buyback programme, and increase our price target to 1,350p," said Berenberg.
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