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magazineOxford Instruments has ‘highly encouraging long-term outlook’
OXFORD INSTRUMENTS
(OXIG) £26.95
Gain to date: 98.2%
Original entry point: Buy at £13.60, 7 November 2019
Excellent companies often go about their business quietly and with little fanfare but, as one analyst said, ‘it is one thing to grow sales and improve margins in strong markets, quite another to do it amid a global pandemic.’
Oxford Instruments (OXIG) is a cutting-edge science tools designer and maker which has demonstrated its world class expertise and the enormous value it brings to the wider scientific community.
There are lots of reasons to be optimistic about the journey ahead too, with a strong order book, operating margins well on the road to 20% (17.8% last year) and with around £100 million of net cash giving plenty of scope for value-adding acquisitions should opportunity present itself.
In July the company gave a strategy presentation to analysts at Shore Capital and while no new market sensitive information was given away, the analysts were left highly encouraged by the significant progress Oxford has made and the long-term outlook assessment.
SHARES SAYS: The 12-month price to earnings ratio sits at 32 which might put some investors off. However, there is scope for a higher share price if the margins expansion happens faster than expected. We still believe the shares are worth buying.
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