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Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Eurofins €112
Gain to date: 60%
Original entry point: Buy at €69.99, 23 December 2020
Shares in world-leading laboratory testing and environmental certification business Eurofins Scientific climbed more than 10% on the day of its recent interim results.
As well as posting record numbers – revenue was up a staggering 40% to €3.3 billion and earnings before interest, taxes, depreciation and amortisation were up 104% to £1 billion, meaning a margin of 30.3% compared with 21% last year – the firm substantially raised its full year guidance.
Full year revenue expectations were increased by 13% to €6.15 billion while EBITDA guidance was increased by 36% to €1.7 billion due to the proliferation of new Covid variants. However, even these figures look conservative and there is a strong possibility that revenue and profit could blow away these forecasts, leading to more upgrades for 2022 and beyond.
‘It appears that the pandemic will drive increasing demand for Eurofins’ services for many years to come’ commented chief executive Dr Gilles Martin.
Meanwhile, the core operations performed well with new product launches in areas such as clinical diagnostics and transplants contributing to overall growth in the first half.
SHARES SAYS: This is a quality business with high barriers to entry, growing faster than expected. We are still buyers.
These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell.
Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.
Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.
The value of your investments can go down as well as up and you may get back less than you originally invested. We don't offer advice, so it's important you understand the risks, if you're unsure please consult a suitably qualified financial adviser. Tax treatment depends on your individual circumstances and rules may change. Past performance is not a guide to future performance and some investments need to be held for the long term.