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  • Writer's pictureMark Watson-Mitchell

Ultimate Products – Ahead Of The August Trading Update, Another Chance At Scoring 180 !

After the recent market fallback due to the forthcoming General Election a number of short-term investment situations are beginning to show up.

Perhaps, none more so than Ultimate Products (LON:ULTP).

We did it before – now let us do it again – just aim at the 180 !

The Business

In early April I noted that ‘surely 80% of the UK households cannot be wrong’ in my feature on the Oldham-based group that supplies branded homeware products in the UK, Germany, the Rest of Europe, and internationally. 

Its own brand names include Salter, Beldray, Intempo, ZFrame, Portobello, Dreamtime, PROlectrix, George Wilkinson, Giles & Posner, American Orginals and Kleeneze.

Analyst’s View

Analysts Nigel Parson and Michael Clifton at Cavendish Capital Markets have a Price Objective of 185p on the group’s shares.

Their estimates for the current year to the end of next month are for an easing off of sales to £157.5m (£166.3m), with adjusted pre-tax profits of £14.5m (£16.8m), generating 12.5p (15.1p) of earnings but still amply covering a dividend of 6.2p (7.4p) per share.

Those lower estimates reflect short-term trading trends in the group’s final quarter.

However, those trends are now turning positive, especially as larger orders are expected from its bigger customers as destocking eases into more normal business patterns.

The analysts are now looking for the next year, starting in August, to show a recovery bounce to £168.5m sales, £17.1m profits, 14.8p earnings with a 7.4p dividend per share.

Further out they have pencilled in the 2026 year for £176.6m turnover, £18.9m profits, 16.6p earnings and a very healthy 8.3p per share dividend.

My View

Ahead of the Pre-Close Trading Update in late August I see this group’s shares staging a smart price recovery.

My feature on 2nd April, when the shares were just 145p and I predicted a rise to 180p within six months, they scooted up to 185.50p before the end of that month.

They are now back to 142p, at which level the group is only valued at £123m.

I now suggest that they are ready for another run upwards ahead of the August Trading Update – giving risk tolerant investors another chance of scoring 180!


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