Coloured gemstone specialist Gemfields (LON:GEM) is at a “pivotal point” in its development, according to JPMorgan Cazenove.
Analyst Alexander Mees notes that the company now owns the iconic Fabergé brand and has just signed up Hollywood actress Mila Kunis as its brand ambassador to showcase the company’s array of precious gems.
He added that the timing of auctions saw half-year revenues dip, but says the company will pick up the slack in the second half.
There was just the one auction in the six-month period compared with two in the same period in 2011.
The group has three auctions lined up for the second half of this financial year, which should balance out full-year revenues, with the group confident that sales throughout the first half of 2013 will be well supported by the expansion of marketing activities across a broader target market.
Gemfields, which ended the period with US$27.9mln cash in the bank, is working towards diversifying and expanding its base of resources, Mees added.
The broker sticks to its ‘neutral’ rating and target price of 38p, against the current price of 33p, up 6% today.