Classification of NuWays AG to Bittium Oyj

Company Name:	Bittium Oyj
ISIN:	FI0009007264
Reason for the research:	Update
Recommendation:	BUY
Target price:	EUR 40
Target price on sight of:	12 months
Last rating change:
Analyst:	Julius Neittamo

Q2 preview: backlog supports growth, H2 has catalyst firepower

Bittium will publish its H1'26 report on August 7. Publicly announced orders during Q2'26 totalled € 26.6m, the vast majority from FDF and set for delivery during FY26. Growth this year is still supported by the very strong order intake from December 2025 (€ 84.4m from Indra, FDF and AAF), with Indra placing a further € 20m order in January 2026. On this basis, Q2'26e group net sales are seen to grow 18.8% yoy to € 27.2m, with Defense & Security (D&S) contributing € 19m (+33% yoy; eNuW). Mind you, aggregate growth in Q2 is expected to be below the FY26e run rate of +28% (eNuW), consistent with commentary that net sales will be heavily weighed towards H2'26, a pattern clearly exhibited between 2022-25.

Q2'26e EBITDA is seen at € 4.6m (vs € 2.9m a year-prior), implying a ~17% margin (+4.3pp yoy; eNuW). Roughly 4pp of that gain reflects € 0.9m of non-recurring Medical restructuring costs booked in Q2'25, with the remainder driven by operating leverage. Q2'26e EBIT is expected at € 2.6m, up from € 1.1m in Q2'25, implying a 9.6% margin (+4.7pp yoy; eNuW), which remains well below the structural run-rate margin (~24%; eNuW), reflecting back-ended profit delivery and elevated D&A from the Indra licensing deal.

FY guidance well in reach. The group order backlog stood at a record € 92.5m in Q1'26, covering 70% of Q2-Q4'26 sales (€ ~132m; eNuW), with D&S backlog at € 84.4m, covering 80% of Q2-Q4'26 D&S sales (€ ~106m; eNuW). While the backlog has multi-year elements, it continues to provide a strong runway to achieve the FY26 guidance (€ 140 - 155m). Given the strong visibility and additional order intake in Q2'26, beating the upper end of guidance would require c. €25m of additional deliveries, in our view. Given the high seasonality of the business, we see this beat as a likely event (eNuW). As mentioned above, FY operating profit will be burdened by rising amortisation from the Indra deal, yet FY26 EBIT is seen at € 27.5m (guidance € 26 - 32m) or ~18% margin, 6pp below the structural margin (eNuW).

Focus will be on H2 pipeline commentary. In June it was disclosed that BAE Systems (Bittium's tactical communications partner), had advanced to the next round of the UK tender; though, it remains unclear when the tender will come to a conclusion. Here, we see three serious contenders: BAE/Bittium, Thales/Babcock and L3Harris. H2 is particularly promising on catalysts, as Bittium has good odds to receive a first (double digit €m) order from the Swedish Armed Forces or to win a new military as a major customer (eNuW).

Given the seasonality and strong sales pipeline of Bittium we see current price levels as an excellent entry point, with +44% upside to our price target. We confirm our BUY rating and € 40 PT based on a DCF model.
 

You can download the research here: bittium-oyj-2026-07-31-previewreview-en-d23e1
For additional information visit our website: https://www.nuways-ag.com/research

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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