MENU

Breville Group Ltd’s share price jumps 11%: Is there room to run?

Breville Group Ltd’s (ASX: BRG) shares have soared to within a whisker of the stocks all-time high of $9.23 on Thursday, after the company released a set of half-yearly results which were applauded by investors. The stock has now gained around 54% in the past 12 months.

The kitchen appliance maker reported an impressive 17.7% growth in revenues to $311.3 million while net profit after tax dropped 1.6% to $31.2 million on account of the loss of the Keurig distribution agreement. The Keurig issue had been well flagged to the market leaving investors to focus on the significant sales momentum in the business.

This momentum saw sales in Australian and New Zealand grow 10.4%, in North America by 15.2% (in constant currency), and in the Rest of World (ROW) division by 69.1%.

Breville shareholder and billionaire, Solomon Lew, is also chairman of apparel group Premier Investments Limited (ASX: PMV) and a “little bit” richer today thanks to his 30.2% stake. Meanwhile shareholders in GUD Holdings Limited (ASX: GUD), which owns the Sunbeam brand of appliances, will once again collectively be shaking their heads at their company’s decision to sell its stake in Breville after an attempt to acquire the company was quashed by a Australian Competition and Consumer Commission (ACCC) in 2009.

Foolish takeaway

Boasting a return on equity of 22.6%, a fully franked interim dividend of 14 cents per share and significant scope to further grow sales in the North American, UK and rest of world markets, Breville’s stock could easily continue to enjoy investors’ favour.

The top ASX pick you've never heard of...

Top Motley Fool analysts just identified their #1 ASX pick for 2014, a small-cap stock that could be poised for big gains (and offers a fat, fully franked dividend!). Discover all the details now, including the name and code, in this FREE investment report, "The Motley Fool's Top Stock for 2014."

Motley Fool contributor Tim McArthur does not own shares in any of the companies mentioned in this article.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.