Science equipment maker Judges Scientific (JDG:AIM) saw business demand bounce back strongly in the second half of 2020, and the company now expects annual adjusted earnings per share (EPS) to top market expectations.
Consensus forecasts had been pitched at 151.8p of EPS for the year to 31 December 2020 but analysts are now recalculating spreadsheets.
‘The performance confirmed pulls through a circa 10% upgrade to our adjusted EPS forecast for the full year’, said Shore Cap’s Robin Speakman on Thursday.
Shares in Judges rose 1.5% higher on Thursday to £64, extending the stellar recovery run which has seen the shares gain 32% since the end of September 2020.
ORDER BOOK BOLSTERED
Through the second half period the order book saw steady improvement ending the year at a ‘respectable’ 14 weeks on an organic basis and 15.5 weeks including strong intake from recent acquisitions.
‘This is encouraging, to our minds, for the business performance for the current year, though noting that Judges sales budget for full year 2021 clearly reflect trading conditions at the outset’, the analysts said.
Overall, the year on year order intake at Judges was down 13%, with 2020 dominated by the Covid pandemic. ‘Judges has come through a difficult year performing well at an underlying level throughout, in our opinion’, said the Shore Cap analyst.
MORE BUYING, MORE BUILDING
Judges, which runs a portfolio of niche science-based businesses spanning nanotechnology, fibre optic testing, advanced materials, LED design and x-ray technology, refused to let the virus outbreak force the business to deviate from its tried and tested buy-and-build strategy, bolting on two acquisitions during 2020.
More of the same is anticipated in the 12 months ahead as economic and business conditions gradually improve as the various Covid vaccines are rolled out.
‘Judges remains strongly positioned to capitalise on opportunities arising through the current year and beyond with market recovery continuing and set to bear on the current full year 2021 price to earnings ratio of 34 and an enterprise value to earnings before interest, tax, depreciation and amortisation (EV/EBITDA) of 23’, concluded the Shore Cap analyst.
