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Our monthly Fire Best Buys Now are designed to highlight our team’s three favourite, most timely Buys from our growing list of growth-focused Fire recommendations, to help Fools build out their portfolios.
“Best Buys Now” Pick #1:
Games Workshop (LSE:GAW)
- In mid-June, Games Workshop released a trading update that delighted the market with its indication of accelerating revenue growth.
- The revenue for FY23, ending 28 May 2023, is set to be no less than £465m (FY22: £415m). This represents a growth of at least 12%, suggesting a significant acceleration to 17%+ growth in H2 23 from 7% in H1 23.
- While the weakening of the GBP has partially contributed to this accelerated sales growth, we continue to be impressed by the management’s ability to deliver steady long-term growth to shareholders.
- There is some disappointment about the decline in licensing revenue to £25m (FY22: £28m). However, we are optimistic that the deal inked with Amazon in December of the previous year will afford Games Workshop the opportunity to monetise its intellectual property through film and television productions in the foreseeable future.
- The company has also generously decided to increase dividends from 235p to 415p this year. This results in an attractive DVD yield of 3.83%.
