What should investors do after a stock has more than doubled over the past 3 years? This is a tricky question with no one answer. However for me, I try hard to hold on to high quality ‘compounders’ through thick & thin. Not getting either shaken out of a winning positions or tempted to bank a quick profit.
Take consumer healthcare products firm Venture Life Group plc who today posted impressive H1’25 results and in line guidance, with adjusted EBITDA and EPS climbing 32.6% and 219% respectively to £1.8m and 0.83p, on turnover 43.1% higher at £15.4m (or 12.4% LFL).
Here the top line is being driven by its power brands (eg Balance Activ +24.2%) and menopausal treatment business Health & Her (acq’d for £10m in Nov’24), which was up 34.5% LFL to £3.9m.
Better still in Jul’25, VLG competed the transformational disposal of its 3rd party brands, manufacturing interests and non-core products for €62m to Biodue SpA - leaving a £34.1m cash pile as at 30th Sept, providing ample fire power to execute both its future organic and M&A strategies.
Indeed, the Board continues to invest in marketing (10.5% sales vs 5.6% LY) that is expected to drive further revenue growth with a number of new distributor listings having recently been added such as CVS in the US and Cooper.
Moreover going forward, house broker Cavendish have a 100p target price on the stock, based on May FY26 turnover, EBITDA, EBIT and EPS estimates rising to £50.4m, £8.0m, £1.9m and 3.8p. Meaning at 55p, the shares trade on a modest multiples of 0.7x EV/revs and 14.5x PER, representing attractive value for a healthcare products firm set to deliver double digit organic growth.
Lastly a buyback has also been announced in order to repurchase up to 12.8m shares (or 10%) with the Board further deciding to change its the year-end to May from Dec, with the first full period closing in May’26. Plus hashtag#VLG plans to sell its non-core mouth-wash brands too (re Dentyl & Ultradex, H1 sales £1.9m).
CEO Jerry Randall commenting: "In a transformational period for the Group I am delighted with the progress made. We have significantly streamlined operations and reduced the burden of investment in manufacturing operations, whilst generating significant funding to grow the business in the coming years.”
“Trading on a proforma basis during Q3 has been robust, and the Board holds a high level of confidence that the Group is well-positioned to achieve its growth objectives – [including] meeting management’s expectations for the 17-month period ending 31 May 2026. Here UK revenues remain a key driver, with the timing of international sales being Q4 weighted, reflecting the re-stocking patterns of the Group's international partners."