Fantasy miniatures maker Games Workshop (GAW) gave a customary brief trading update on trading for the three months through February, saying trading was in line with expectations.
The company declared a dividend of 70p per share which will be paid on 13 May for shareholders on the share register on 1 April.
The payment takes the total payout for the financial year to 29 May 2022 to £2.35 a share, up 27% year-on-year.
Announced dividends are already above the market’s full year expectation of £2.25 per share according to Refinitiv data.
At the very least this suggests cost inflation the company identified at the half year results is being well managed.
Investors took the view that the stock’s recent poor showing had gone too far and marked the shares up 11% to £78.98.
BIG DERATING
Over the last six months the shares have fallen 36%, underperforming the FTSE 250 index by 25%.
This has resulted in the prospective price to earnings ratio dropping from almost 30 times last September to 18 times today.
This represents a 40% derating to the bottom end of the range established over the last three years.
Meanwhile, analysts’ earnings expectations have remained steady at around 383p per share. The prospective dividend yield has increased from 2.1% to 3.3%.
Games Workshop proved to be a beneficiary of lockdown despite its retail shops being closed as business migrated online.
Tough year-on-year comparisons and a period of normalisation meant it was always going to be a challenge for the company to continue to beat earnings expectations.
Games Workshop intends to publish a full year trading update in June 2022.
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