2017 was another fizzy year for the drink mixers producer. Opening at £11.46 the stock rocketed all the way to £22.70 by the end of December, a whopping 98% increase across 12 months. And the thing is, it could have been even better, with FeverTree striking £25 in early September.
No matter – 2018 has seen the stock return to, and surpass, those autumnal heights. A sharp climb leaves Fever-Tree Drinks PLC at a current trading price, and all-time high, of £26.69, already securing a 17% rise this year.
Much of the stock’s 2018 surge stemmed from speculation in mid-January that Fever-Tree could be the target of a takeover, an idea sparked by the appointment of Unilever’s (LON:ULVR) Kevin Havelock as a non-executive director and furthered by ‘Buy’ ratings from Morgan Stanley (NYSE:MS) and Jefferies.
As for something a bit more concrete, investors had plenty to cheer in the firm’s January 24th update. Fever-Tree is expecting its annual revenue to rise 66% to £169 million, after a 58% increase in the second half of its financial year. Sales in the UK are forecast to have risen 96%, while in the US revenue is estimated to jump 39%, in continental Europe 42% and the rest of the world 57%.
Perhaps the greatest titbit was Fever-Tree stating that its full year profits will be ‘comfortably ahead of market expectations’. That’s the 12th time the company has upgraded its profit forecasts since debuting on the Alternative Investment Market back in 2014. Now FeverTree just needs to walk that very precarious tightrope of investor expectation.
Fever-Tree Drinks PLC (LON:FEVR) has a consensus rating of ‘Buy’ alongside an average target price of £23.66.
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