SUMMARY

• High growth momentum continues, margins hold up well.
• The IP segment remains under-appreciated by the wider investment community.
• Continued innovation remains the key risk moving forward.

INVESTMENT THESIS

Recent declines from circa £70 per share to circa £50 per share merited a renewed analysis of Games Workshop. The fundamentals remain solid, with the company well positioned to deal with any uncertainty caused by COVID-19. Growth momentum remains on track and profitability (and dividends) continue to grow at a rapid pace. The future looks bright for Games Workshop, and current prices indicate a good entry point for new and existing investors alike.

BACKGROUND

Games Workshop (OTCPK:GMWKF) (LSE:GAW) has been perfecting the art of high-quality miniatures since 1975, and this 43-year tenure has positioned the company for exceptional performance as growth in gaming continues at record rates throughout much of the developed world (Claremont, 2014). During this time, it has developed some of the most complex and complete fantasy and sci-fi universes that rival the likes of Star Wars and Lord of the Rings.

Kevin D. Rountree took over the role of CEO in 2015 and has exceeded expectations ever since. Since then, a number of successful changes have been made across the group.

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