Scientific instruments maker delivers exceptional first half performance


Gain to date: 77.2%

Original entry point: Buy at £28.50, 11 April 2019

A near-80% gain in a few short years would be impressive, but to do it in just a handful of months takes luck as well as good judgement.

Yet this is what’s happened to the performance of Judges Scientific (JDG:AIM) since we highlighted its attractions in April.

The company is a portfolio of niche science-based businesses spanning nanotechnology, fibre optic testing, advanced materials, LED design and x-ray technology.

We originally said it was a proven, high-quality business that was simply too cheap on a 2019 forecast price-to-earnings multiple of 14.8. We saw very good re-rating opportunity and so it has come to pass.

This is in part thanks to September’s record half-year results that set new high bars for revenue, adjusted pre-tax profit, earnings per share, cash generation and dividends, but also for management’s upbeat comments which put to bed investor concerns about an economic slowdown.

The re-rating leaves the stock trading on 24.3 times next year’s expected earnings. Investors taking a multi-year view should stay with the story, but for those with more immediate priorities, this may be a prudent time to top slice profit and take some money off the table.

SHARES SAYS: Consider taking some profit.

‹ Previous2019-11-21Next ›