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magazineThe little known company that’s gone up by 88% since October
Treatt (TET) £11.45
Gain to date: 88.6%
Original entry point: Buy at 607p, 29 October 2020
Our belief that it would be premature to take profit in extracts and ingredients manufacturer Treatt (TET) in January has been vindicated with the shares extending their recent gains off the back of another strong trading update (12 Apr).
The company said it expected to grow its first-half revenue by 14%, while also achieving an improvement in margins.
Revenue for the six months to 31 March was seen rising to around £60.8 million.
Growth was particularly strong in the tea, health and wellness, and fruit and vegetables categories, ‘meeting growing global consumer demand for healthier living,’ Treatt said.
The company said gross margin improvements reflected the growth in those categories and the transition into ‘more sophisticated, solution-driven’ products in citrus.
The company is also in the process of a moving to a new headquarters in Bury St Edmunds which should boost efficiency and capacity.
Investec analyst Nicola Mallard commented: ‘Despite the pandemic’s obvious impact on the global beverage trade, Treatt continues to deliver strong momentum. The move to cleaner, healthier foods and beverages is increasing the size of Treatt’s addressable market.’
SHARES SAYS: We continue to see Treatt as a buy.
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