The stock of Games Workshop has recently taken a hit. Despite being one of the best performing in the market, the company has recently lowered its target price. The company has cut its price target to 12,250p from its previous price of 15,000. However, this doesn’t mean the stock is a bad investment. Here are some factors to consider when investing in Games Workshop. We’ve included the current price, the growth outlook, and the risk of losing money.
Size of its market
The growth of the company has come at the expense of the size of its market. Games Workshop sells miniature figures and other products based on different scenarios and iterations of games, and it also publishes countless books and magazines about gaming. The company has consistently stayed away from debt and equity. Its market is relatively small and it’s hard to determine how large a market it can sustain.
Stable reputation and high-quality products
In addition to its stable reputation and high-quality products, Games Workshop has also been able to raise its prices every year. While most companies have to pay more to make a profit, the company has managed to maintain a superior gross margin. And with its ability to increase prices year after year, there’s a good chance it’ll continue to do so. That means you’ll have a higher chance of making a profit if you invest in Games Workshop now.
