Given the deteriorating outlook for the UK consumer, investors would do well to add some defensive ballast to portfolios. Fantasy miniatures maker Games Workshop (GAW) is a good example.

The £387m cap has a loyal base of global customers. These are hobbyists who are nigh-on obsessional about the company’s high quality miniatures and games.

Peel Hunt analyst Charles Hall has upgraded his price target from £11.50 to £13.50 and nudged up his earnings estimates following a bullish trading update (2 Jun) from the company associated with the Warhammer brand.

Games Workshop says pre-tax profit for the year to 28 May will be at least £38m on sales of around £158m. Generating more than 70% of sales overseas, Games Workshop continues to benefit from the weak pound, whilst growing revenue through store openings and broadening the product range.

Ahead of the 2017 results publication on 25 July, Hall has upgraded his pre-tax estimate from £34m to £38m for earnings per share of 91.8p, with £34m and 82.1p respectively for 2018.

This decline prudently reflects an expected dip in royalties and increased wage costs, although Hall sees Games Workshop delivering £35m profit and earnings per share of 84.4p in 2019.

Games Workshop also offers an attractive 6.7% yield, based on a forecast dividend of 80p.

We’re buyers of resilient, cash-generative Games Workshop at £12.

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