A strong set of interims from Saga, which should be very well received given strong strategic and financial delivery (EBIT +17% on +7% revenue). We make four key points: (1) Underlying PBT of £23.5m beat internal expectations, prompting a material upgrade to FY26 guidance; (2) Travel PBT rose 33% on +16% revenue, with momentum across Ocean, River and Holidays; (3) Strategic execution remains firmly on track the Underwriting sale is complete, Ageas and NatWest partnerships are set for Q4, and new divisional leadership is embedding improved execution; (4) Net debt fell to £515m (vs £590m Jan), with leverage down to 4.3x and forecast to fall to 2.6x by FY28. With refinancing and restructuring largely behind it, Saga is pivoting from balance sheet repair to growth, execution and cash generation. On revised guidance, we raise FY26-28 PBT forecasts by 7-79% and lift our 12m TP from 285p to 410p. Shares have rallied ~40% since our June initiation but remain cheap at 7x P/E and 6x EV/EBITDA. Execution is landing, debt is falling, and momentum is building. Buy.
