Primary Recommendations

Cake Box - Acquisition of Ambala provides second leg in Asian sweets

May 2025

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

Over the month I met again with Sukh Chamdal and Michael Botha, founder & CEO and CFO respectively of Cake Box, a company that operates a chain of franchised stores selling fresh cream celebration cakes across the UK. The business boasts a terrific record with pretax profit increasing from £1.17m in FY’16 to £6m in FY’24 and broker Panmure Liberum forecasts further growth to £7.8m in the year starting 1 April and £8.6m the following year for earnings per share of 14.3p and 15.6p. As regular readers will know I view it as a cheap share (on a prospective PE of 12.3 and 11.3) for a business with clear market leadership, having expanded from 91 outlets at the time of its listing in June 2018 to the current 232. Cake Box has churne ...

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Elementis - Specialty chemicals firm enjoys surge in operating margins

Cake Box - New openings ahead of schedule (January 2025)

Cake Box - Rising sponge sales drives gross margin increase (August 2024)

Cake Box (June 2024)

Cake Box - Gross margin lifts sharply (January 2024)

Cake Box - Upgraded site target not reflected in lowly prospective PE of 11.2 and then 9.7 (December 2023)

Cake Box Like-for-like sales accelerate (October 2023)

Cake Box - Rejects bid approach (September 2023)

Cake Box - Cake shop franchise on the turn; PE less than half former peak (February 2023)

Cake Box (October 2022)

Cake Box (August 2022)

Cake Box - Strong pipeline of new opening (December 2021)

Cake Box - Liberum upgrades price target to 450p (November 2021)

Cake Box (August 2021)

Cake Box - Target price raised to 360p (June 2021)

Cake Box (December 2020)

Cake Box (November 2020)

Cake Box - Franchised cake shop business with plans to double estate to 250 stores (August 2020)

Cake Box - IPO spikes to large premium (August 2018)

With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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