Strix strikes confident note in figure light update
STRIX (KETL:AIM) 148.2p
Gain to date: 5.9%
Original entry point: Buy at 140p, 26 April 2018
There’s a few nuggets of information from kettle controls manufacturer Strix’s (KETL:AIM) latest update (22 Jan) worth noting, not least on the net debt front, where the best part of £10m has been shaved off since the end of June 2018 to £28m now.
That should mean more cash available to pay dividends in future, underlining the 7p per share payout for 2018 and a 10% increase anticipated by analyst in 2019, implying a 5.2% income yield.
The update is a little light on financial detail but investors are told that the underlying kettles market continues to grow at around the 7% mark (as expected) in spite of trade tensions.
We also know that Strix has maintained its market leading 38% share. One question that will need answering when full year results are published is to what extent robust volumes, and new lower cost U-9 series, may have had on profit margins.
In the meantime, the company continues to make excellent progress on its Aqua Optima water filter lines, where it now has a 25% market share in the UK.
SHARES SAYS: Analysts continue to see the shares hitting 210p over the coming months despite the modest progress so far, and we have little reason to disagree. Still a buy.