An annual survey of aerospace and defence engineers by stockbroker Charterhouse Tilney, rates shares of 10 of the 21 firms reviewed a buy. It spotlights Cobham the flight re-fueling outfit, and shipbuilder Vosper Thornycroft.
Both are involved in contracts awarded under Government initiatives, competing for quality (CFQ) – in which departments put projects up for tender – and the private finance initiative (PFI).
Cobham, biggest of the second division of defence contractors, should provide investors with returns `comfortably exceeding’ the market as a whole, says Charterhouse. `PFI and CFQ successes and prospects could lead to a further re-rating of the shares,’ it adds.
Vosper will `increasingly benefit’ from its CFQ and PFI awards. It has £85m cash in the kitty and its shipbuilding order book stretches beyond the millennium.