Shares round-up: Raspberry Pi a star performer as others falter

Debut results by Raspberry Pi Holdings (LSE:RPI) were today’s pick of the FTSE All-Share in a session when investors lost their appetite for Card Factory (LSE:CARD), Smiths Group (LSE:SMIN) and AG Barr (LSE:BAG).

The shares of the low-cost maker of general-purpose computing platforms have now risen 34% since their June stock market listing at a price of 280p.

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Having previously forecast a second-half weighted performance due to the impact of an industry-wide inventory correction, today’s results showed this is no longer the case after half-year figures came in ahead of internal expectations.

Founder and chief executive Eben Upton said: “Overall, we are encouraged by the resilient performance of the business given the market conditions widely reported by our peers. Our expectations for the full year remain unchanged.”

The shares joined the FTSE 250 index on Monday and today lifted 29.6p to 377.8p as the best-performing stock in the main London market.

Since its launch in 2012, the Cambridge-based group has sold over 60 million units for industrial internet-of-things (IoT) purposes and to enthusiasts and educators in markets worldwide.

Today’s figures showed half-year revenues rose 61% to £144 million, with sales skewed towards higher margin variants as operating profit lifted 44% to £15.7 million.

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Highlighting a price target of 448p, analysts at Jefferies said the 2025 revenue and earnings outlook is positive with industrial and IoT demand expected to be the primary driver.

Another robust results performance by Smiths Group, which included its 73rd year of paying a dividend, failed to keep the conglomerate off the top of the FTSE 100 fallers board.

Its shares dropped 133p to 1,687p after forecasting the moderation of growth at Smiths Detection and flow control arm John Crane following their strong performances in 2023-24.

Detection grew annual organic revenues by 11.1% and John Crane by 9.8%, offset by a 0.8% reverse in temperature management business Flex-Tek and 6.5% at Smiths Interconnect.

The latter returned to growth in the second half, underpinned by signs of a recovery in semiconductor testing alongside growth in aerospace and defence-related programmes.

Overall revenues were 5.4% higher, within the forecast range of 4%-6% as one of three medium-term targets achieved in today’s full-year results.

Having announced annual savings of £35 million by 2027, Smiths said it has a clear plan on how to improve the operating profit margin from today’s 16.8% to within the range of 18%-20%.

The company, which increased the dividend for payment on 22 November by 5.2% to 30.2p a share, added: “Each of our businesses has a clear roadmap to improve profitability.”

In the FTSE 250 index, Dunelm Group (LSE:DNLM) shares fell 5% or 67p to 1168p after deputy chair Will Adderley raised £114 million in a move that reduced the founding family’s shareholding to 37.6%.

The disposal representing 4.9% of Dunelm’s share capital took place at 1,140p, compared with last night’s closing price of 1,235p and April’s low for the year of 967p.

The retailer said today: “Sir Will Adderley remains fully committed to Dunelm in his role as deputy chair as well as remaining a very substantial shareholder in the company.”

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It was joined on the fallers board by AG Barr, which has been another of the FTSE 250’s strong recent performers but lost 32p to 630p after today’s half-year results.

The company behind the drinks brands Irn-Bru, Rubicon, Boost and Funkin left revenue and margin guidance unchanged as it reported a 8.5% increase in adjusted profit to £29.3 million.

The interim dividend for payment on 1 November increased 17% to 3.1p a share, in line with the policy to pay a quarter of the previous full-year dividend. Peel Hunt reiterated its price target of 700p following the update.

In the FTSE All-Share, a results-day reverse of 29p to 113.8p meant Card Factory shares unwound the gains of the past two months.

The retailer, which designs 80% of its own cards and has a manufacturing facility at Baildon in Yorkshire, lifted half-year revenues by 5.9% to £233.8 million amid another strong performance across its growing store estate.

However, adjusted profits fell 34.4% to £14.5 million due to substantial increases in the National Living Wage plus freight inflation and the cost of strategic investments.

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Heading into the key Christmas period, the company said its strong top line performance and efforts to mitigate cost pressures meant it saw no need to change full-year expectations.

On the eve of the results, UBS upped its price target to 180p and forecast that free cash generation could support 40% of market cap being returned to shareholders in the next three years.

It said: “Often overlooked as an old-school retailer, demand for Card Factory’s products is low growth but remarkably resilient, with consistent outperformance driven by store roll-out and category expansion.

“The group’s vertically integrated business model allows for stable mid-teen earnings margins with limited cash drag.”

Even before today’s reverse, the Swiss bank noted that shares were a 25% discount to their 10-year historical average and about 40% discount to the UK mid-cap retail sector.