I’ve mostly bought dividend stocks lately but in January I threw caution to the wind and bought a red-hot -listed instead. And I haven’t regretted it for a moment. Cosmetics specialist ( ) has been driving my portfolio upwards and I’m optimistic that’s going to continue.
I know little about the cosmetics industry, but I know that if a growth stock keeps hiking earnings guidance, it’s on the right track. Even better if it has ample cash reserves, no debt and pays dividends, too. Warpaint does all of this.
I wasn’t the only one to have spotted its potential. Its shares had been going gangbusters. That tempted me, but also scared me.
What if this was speculative froth? Warpaint is winning So I did more research, and . I decided that if Warpaint was doing this well in the middle of a cost-of-living crisis, it could do even better when shoppers had more money in their pockets. Its main brands, and , are sold both in the UK (including ), and via local distributors and retail chains in the US and Europe.
Warpaint has an e-commerce business in China too. These are early days, but the growth potential is huge. In April, the group posted record full-year profits, up 136% to £18.
1m, with growth in all geographic regions. UK revenues jumped 17.6% but were beaten by US sales growth of 36.
8%, while EU revenues trumped both jumping 60.5%. The board hiked the full-year dividend 27% to 9p a share.
The trailing yield today is 1.53% but I think that underplays its progressive poten.