Market's view on Porvair
Published on April 2024
- A stock watcher noted an encouraging modest purchase by the Finance Director amidst large institutional trades.
- Caution over the company’s “second half weighting” was expressed, with an optimistic outlook for the latter part of the year and significant improvements expected by 2025. The timeline for replacing CEO Ben Stocks, retiring in 2025, is considered sensible.
- Despite a short-term downturn in revenue growth in the second half of the year, the company’s reputation for steady growth and high-quality management under Ben Stocks is highlighted as a core strength.
- The acquisition strategy of the company is viewed positively, with recent purchases expected to enhance earnings in 2024.
- Continued steady performance and commendable results despite potential economic challenges, maintaining a strong end-of-year order book.
- Cash generation remains strong, with recent trading updates indicating revenue growth and expectations of double-digit EPS growth.
- Concerns about valuation being potentially overpriced given the current earnings projections and stock performance.
- The company’s long-term prospects are still seen favourably, with potential for the stock price to significantly increase if it aligns with historical earnings multiples.
- Interest in the company’s stock is maintained, with suggestions to buy on price dips for potential long-term gains.