QinetiQ’s Hold Rating: Addressing Financial Stability, Leadership Changes, and Growth Challenges

Analyst David Farrell of Jefferies maintained a Hold rating on QinetiQ (QQ – Research Report), reducing the price target to p420.00.

David Farrell has given his Hold rating due to a combination of factors that QinetiQ needs to address to regain investor confidence. The company issued a profit warning in March, which has raised concerns about its financial stability and future performance. Investors are particularly interested in understanding the risks associated with the Global Solutions segment and what measures are being taken to restore double-digit revenue growth in the EMEA Services division.
Additionally, there have been significant leadership changes over the past four years, and clarity on these decisions is essential for rebuilding trust. The upcoming FY25 results are seen as a crucial opportunity for QinetiQ to provide transparency and detail on these issues. Until these questions are adequately addressed, David Farrell maintains a Hold rating, suggesting a cautious approach while preferring other companies like AVON, BAB, and CHG.