One of my favourite stocks recently took the top spot for best performance over five years on the . Now at £13.85 per share, it’s risen 206% since May 2019, delivering an average return of 25% per year.
The company? ( ) Had I bought 1,000 shares in the stock five years ago when it cost £4.52, I’d have over £15,000 now (taking into account dividends). That’s pretty good, considering not many investments triple in only five years.
If I bought another 1,000 shares today (and the annual returns remained the same), my pot could grow to nearly £100,000 in another five years! But there’s no guarantee it will. The of 22.9 is high and it’s overvalued by 4.
3% based on future cash flow estimates. Chances are I missed out on the most lucrative growth years. Not to worry – there’s plenty more where that came from.
I’m now eyeing another UK defence stock that looks undervalued and primed for growth. Moreover, it’s caught the attention of a big-name broker lately. QinetiQ ( ) hasn’t enjoyed anywhere near the growth of BAE Systems.
It’s up only 42% in the past five years, providing annualised returns of 7.25%. In 2022, it posted a £15m loss in operating income partly due to foreign exchange fluctuations following the $590m acquisition of US security intelligence firm Avantus Federal.
After that, a few lost contract opportunities contributed to its struggles – an ongoing risk for defence contractors. It faces fierce competition within the global defence industry a.
