MIDAS SHARE TIPS UPDATE: Huge profit if you bought our Games Workshop recommendation

Midas last tipped Games Workshop in the depths of the 2020 lockdown when thousands of teenagers discovered that painting orc armies was more satisfying than baking banana bread.

Then, we marvelled that this manufacturer of models and games had become bigger than Marks & Spencer. Now we can only watch in awe as it takes its place in the FTSE 100.

What is the Games Workshop secret? Passion, intellectual property, and a sense of community set the company apart from its peers. Its executives, like the game players, know that conditions can change with the roll of the dice.

The most recent half-year statement last week summed it up: ‘We know through experience that, at Games Workshop, speculation is unwise and extrapolation is a fool’s game.

‘We will, therefore, continue to stay focused on managing the business under all scenarios. So far, so good.’ The company’s stores provide an experience, rather than just a retail opportunity, and employ enthusiasts who connect with their clients.

Games Workshop has also kept a tight hold on its intellectual property, which it is licensing only now – and this could give it a rich seam of extra revenue.

Class act: A deal with Amazon for possible films and television programmes based on Games Workshop’s Warhammer series could boost demand further

Midas tipped the shares at £87.80, figuring that the pandemic had moved us towards a love of smaller, home-based leisure gatherings, which benefits businesses like this. As it happens, the cost-of-living crisis favours this trend too, so Games Workshop has continued to thrive.

Meanwhile, a deal with Amazon for possible films and television programmes based on Games Workshop’s Warhammer series could boost demand further.

Midas verdict: How far can Games Workshop go? If you bought the shares when we tipped them in 2020, you would be sitting on a huge profit. They closed at £142.50 last week and yield a healthy 3.6 per cent.

While there is much to be excited about with the Amazon deal, which could seriously increase the brand’s visibility, there are orcs on the horizon too.

These include National Insurance and wage increases, which could hit prices, and the possibility that the Amazon licensing deal does not lead to the potential hits that fans hope it will.

Games Workshop retains its magic but every Warhammer player knows that events can sometimes take a dark turn when you don’t expect them to.

So if you are sitting on a tidy profit, take some of it now rather than waiting for the dice to turn against you.

Traded on: Main Market Ticker: GAW Contact: investor.games-workshop.com

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