Investment bank BNP Paribas has significantly increased its share price target on Eutelsat following the satellite operator’s results on August 5th. The target price jumps from €1 to €2.9, but the bank still advises clients to consider Eutelsat as an ‘Underperform’ stock, despite having the view that its OneWeb division was now “taking off”.

The bank, in a note to clients, said: “Eutelsat’s Q4 revenues came 5 per cent ahead of consensus, driven by solid 31.5 per cent organic revenue growth in the group’s LEO revenues (mostly OneWeb). Government Services, helped by solid demand from Ukraine, Taiwan and other non-US governments, grew 41 per cent in Q4 25 and underpins our view that European Satellite operators including Eutelsat are well positioned to benefit from increased spending on European Defence as well as from ongoing geopolitical trends. FY25 adj. EBITDA came in 2 percent ahead and net debt 2 per cent below consensus. Shares were up ~12 per cent at the close.”

The report continued: “Management has reaffirmed all elements of its short-term and medium-term guidance, including its forecasts of more than 50 percent organic revenue growth for LEO revenues in FY26 as well as €1.5-1.7 billion of FY29 revenues with at least 60 per cent adj. EBITDA margins. We have increased our medium-term forecasts for FY29 revenues and EBITDA by 7 per cent and 13 per cent respectively.”

“With confirmation of a €1.5 billion capital increase by year-end and guidance of a net debt to EBITDA of c2.5x by year-end FY26, Eutelsat’s balance sheet structure is improving at a time when OneWeb revenues are taking off. LEO revenues accounted for 15 per cent of FY25 revenues and we estimate will account for 24 per cent and 30 per cent of Eutelsat group revenues for respectively FY26 and FY27,” added the report.

“Our new forecasts reflect the €1.5 billion capital raise (55 per cent placed to government shareholders at a 21 percent premium to the last closing price) and improving medium-term prospects. We raise our TP from €1 to €2.9 (using 3x ’26e EV/sales on higher forecasts vs 2.5x before) but retain our cautious view in a context of growing competitive pressure from LEO new entrants. We prefer SES (+) which benefits from higher exposure to Government, a solid MEO infrastructure and more C- band upside,” concluded the report.

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Tags: BNP Paribas, eutelsat, LEO, OneWeb