Jefferies has lifted its price target for Games Workshop Group PLC (LSE:GAW) to 21,000p and reiterated a bullish stance after the Warhammer maker delivered another exceptional set of half-year numbers this week.
The broker said the group’s core business continues to power ahead, with H1 core revenue rising 15% to £310 million, surpassing the broker's forecast and outperforming strong prior-year comparatives.
Despite an expected pullback in licensing income this time around, first-half profit is seen at around £135 million overall, comfortably ahead of last year and well above Jefferies' £110 million estimate.
While second-half growth is expected to moderate to around 7% as a three-year release cycle normalises, analysts retain conservative assumptions, in contrast to Games Workshop’s track record of consistent double-digit expansion.
Jefferies, in a note, described the business a “rare asset” with industry-leading margins, scale advantages and world-class IP.
Analysts at the broker reckon Games Workshop's premium valuation remains justified.
Repeating a 'buy' rating, Jefferies highlighted an exciting pipeline and scope for further earnings upgrades.