Shares in Bloomsbury (BMY) gained more than 10% last week as the publisher increased its footprint in North America with a strategic acquisition. Bloomsbury shares have gained nearly 30% year-to-date.

The successful publisher of science fiction and fantasy books showed investors it was intent on diversifying its revenue base and increasing its digital offering with the £65 million purchase of academic publishing firm Rowman & Littlefield.

The deal adds 40,000 academic titles to Bloomsbury’s portfolio and builds upon the publisher’s six-year 2030 strategy unveiled at the time of its annual results on 23 May.

The company saw pre-tax profit soar to £41.5 million for the year ending 29 February, amid strong demand for American author Sarah J Maas’ romantic fantasy series and its Harry Potter back catalogue.

Rowman & Littlefield generated revenue of $36 million (£28 million) and pre-tax profit of around $6 million (£5 million) for the year ended 31 December 2023. 

Investec analyst Alastair Reid said: ‘On our forecasts, we increase revenues by circa 10% longer-term as the acquisition impact annualises, which leads to a circa 12% increase in earnings, underpinning our target price increase.

‘The group’s growth potential, and management’s track record, continues to be under-appreciated in our view.’

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