UK 20:01 Sunday, 27 September 2026
Breaking news and expert analysis on fast-moving AIM and LSE listed shares
Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
I always like a niche company. A niche you'll remember is a useful hole in a wall. The niche is useful, yet is small and discreet enough to be overlooked.
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Comments
Paul Scott
Malcolm,
I agree that Zytronic is an excellent little niche company.
It makes a very strong operating profit margin, of c.20% in good years, and also has significant net cash on the Balance Sheet, of about 17% of the entire market cap. This cash rich position enabled them to maintain the generous dividends even when they had a bad year in 2013. Profits bounced back strongly in 2014, as you mention in your article. The order book & sales pipeline is also much better now than it was a year ago.
The share is not without risk though – as order visibility is relatively short (typically no more than 4-8 weeks), there is always the chance of a gap opening in the order book, leading to another profit warning. Although as we have seen in the past, a profit warning with this company is the time to buy.
Regards, Paul.