Games Workshop (GAW) £139.20

Gain to date: 16.5%

We (once again) flagged the attractions of fantasy miniatures outfit Games Workshop (GAW) in October, arguing the company had rediscovered its growth mojo and was set to leave the logistics problems it endured during the pandemic behind it.

WHAT HAS HAPPENED SINCE WE SAID TO BUY?

It may have been a little more than a month since we added Games Workshop to our Great Ideas portfolio but already there has been an early endorsement of our investment case.

In a typically sparsely worded statement on 22 November the company noted trading since 8 September is tracking ahead of expectations and provided new financial estimates for the half year to 1 December.

Games Workshop now estimates first-half core revenue at actual exchange rates should increase by a tenth to not less than £260 million and sees licensing revenue of more than £30 million compared with £13 million in the prior year.

Pre-tax profit is estimated to be not less than £120 million, equating to a 25% year-on-year gain.

And, ahead of a 31 December deadline, Games Workshop announced it had agreed creative deadlines with Amazon (AMZN:NASDAQ) for TV and film adaptations based on its Warhammer 40,000 universe and an option to subsequently licence broader Warhammer Fantasy IP (10 December).

Investors seemed relatively underwhelmed, perhaps reflecting the fact any resulting productions will take several years to bring to the screen.

WHAT SHOULD INVESTORS DO NOW?

This is a unique asset on the UK stock market. It benefits from a devoted fanbase which could be extended by the Amazon tie-up bringing its content to a broader audience. On that basis we think the shares continue to have exciting potential, with the next potential catalyst provided by first-half results on 14 January. 

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