Ramsdens Holdings (LON:RFX) – delivering consistent upgrades over the last four years

09.04.2025

Yesterday’s Trading Update from this Middlesbrough-based group was bullish, but the group’s shares have yet to reflect its real value.

It has some 169 stores as well as an online offer, it is a growing, diversified, financial services provider and retailer, operating in the four core business segments of foreign currency exchange, pawnbroking loans, precious metals buying and selling and retailing of second-hand and new jewellery. 

Updating on its first-half trading to end-March, the group reported that it had continued to benefit from its diversified model of financial and retail services delivering growth across core income streams.

As a result of continued positive momentum in the first half of FY25, the Board now expects FY25 profit before tax to be at least £13.0m (FY24: £11.4m), which is a clear £1.0m ahead of previous expectations.

CEO Peter Kenyon stated that:

"We are pleased to have delivered a strong performance during the first half of the year, underpinned by our diversified model as well as benefitting from investments made across our four operating segments, including the launch of new dedicated customer websites and services.

This positive trading momentum, together with the continued benefit to the Group presented by the sustained high gold price, has led the Board to increase profit expectations for FY25.

We look forward to building on this positive performance throughout the second half of the financial year."

In a 38-page research note on the group, analysts James Allen, Rae Maile and Ross Lucknall, at Panmure Liberum, stated that they were impressed by the group benefitting from the higher gold price.

The analysts upped their Buy Rating on the group’s shares, while increasing their Target Price to 340p (previously 320p) compared to last night’s closing price of 235p, which was 30p up on the day after the group’s updated guidance.

For the full year to end-September they look for group sales to increase to £104.0m (£96.0m), with pre-tax profits improving to £13.1m (£11.4m), generating earnings of 29.7p (25.7p) and a dividend of 12.9p (11.2p) per share.

The analyst commenting on the results, stated that:

“It was driven by the ‘strong gold price but with a small bump in retail jewellery as well for good measure. 

The upgrade adds the latest leg up in what management refers to as the “earnings staircase”, or 12-month forward earnings-per-share over time, which shows that Ramsdens has delivered consistent upgrades for the last four years and counting,’ he said.   

The outlook for the second half is positive and full-year 2026 forecasts ‘feel prudent based on our analysis of the store estate’, which provides protection should the gold price fall.   

Ramsdens has quietly grown into what should be a top 10 jewellery retailer in the UK over the next few years.”

Just over a year ago, when the group’s shares were trading at 190p, I stated that they offered very strong upside potential for medium-term investors.

Despite now being some 24% higher in price, I still rate the shares, which climbed 30p on the news, to close at 235p and are this morning off 5p at 230p, as a Buy looking for them to again break above my previous Target Price and go even higher yet, with the previous achieved 272p as being an easier price aim.

(Profile 07.11.19 @ 204p set a Target Price of 250p*)

(Asterisks * denote that Target prices have been achieved since Profile publication)