Market has been slow to pick up on potential, but we believe that will change

QUIXANT (QXT:AIM) 458.5p

Gain to date: 4.8%

Original entry point: Buy at 437.5p, 25 January 2018


There is no question that Quixant’s (QXT:AIM) share price progress has been surprisingly lacklustre even in the face of continued robust and disciplined financial performance. Half year results on 19 September only embolden our view that it is a long-run, and attractive, growth story.

The first point to make is that last year’s bumper first half was never likely to repeat (thanks to a big one-off order), a point on which management have been crystal clear. A return to the normal 40:60 first half, second half split is expected.

In that light investors can take management’s expectation of another record year in 2018 at face value especially given record unit shipments and order book.

It’s also encouraging that the company will not chase volumes at the expense of profit margins, which should ensure pre-tax profit around the $19m ballpark, versus $17.7m on an adjusted basis in 2017. That’s in spite of some cost pressures, much of which Quixant has been able to pass on to customers, always a sign of a value-adding supplier.

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