Cavendish: Buy with 100p target26 Feb 2026 11:27
After the confident 26th Jan trading update to 31st December Cavendish reiterated their Buy and 100p price target.
They forecast 3.8p EPS to this May, rising to 5.2p EPS and then 6.6p EPS.
The cash pile is forecast at £37.4m this April, rising to £43.4m then £51.1m - against the current £86m m/cap.
Of course this doesn't allow for any acquisitions in terms of enhancing those earnings or the cash pile.
They summarise as follows:
"Delivering on strategy Venture Life has provided a trading update for the 12-month period to December 2025, within the extended 17-month fiscal period to May 2026, reflecting the company’s change of year end. Following disposals through 2025 (CDMO operations and various brands), Venture Life generated revenues from continuing operations of £35.1m, up 32% reported or 11% YoY (10% volume / 1% price) on a proforma basis, which assumes acquisitions in place for the full prior 12-month period. Revenue growth was driven by the impact of increased investment in advertising and promotion (A&P) in the UK, in line with the company’s stated strategy. Venture Life closed 2025 with net cash of £34.4m, which alongside an undrawn £50m RCF provides the company with a strong balance sheet to pursue M&A opportunities, targeting complementary sectors. The board remains confident in achieving expectations for the 17months to May 2026."
"— Outlook: The Board remains confident in achieving the revenue and adjusted EBITDA expectations for FY26. Versus our FY26 revenue target of £50.4m, the company needs to deliver c£15.3m in the remaining 5-month period, c£3m per month on average, in line with the performance to December. Management remains focused on M&A opportunities and the share buyback programme has acquired c2.7m shares (target 12.8m) for c£1.7m to date, at an average price of c64p.
— Investment thesis: We believe Venture Life’s new structure sets a strong foundation for future organic and M&A-driven revenue growth with margin expansion. The company has focused its brands on healthy longevity and will provide increased investment support to achieve market-leading positions, while enhancing growth through M&A, with both strategies supported by a strong balance sheet. With the shares still trading on c1x forward sales, we believe the company remains attractive."
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