Stock of the month – February 2026

Strong core constant currency growth of 18% in H126 (end of November 2025) in an ‘off year’ without any new edition releases of its two main intellectual properties, while the Amazon partnership for Warhammer 40K films, television series and associated merchandising rights progresses in the background.

Why this stock?

In focus: H126 results showed c 18% constant currency revenue growth in its core business without the launch of any new editions of its two main intellectual properties (IPs), demonstrating exceptional underlying brand strength and customer loyalty. Strong cash generation has led to the declaration of six dividends totalling 485p/share year-to-date, versus 420p/share at the same stage in FY25.

Momentum: The H126 trading update in November led to Edison upgrading FY26 profit estimates by c 12%. The company is opening 35 new stores globally in FY26 and should continue to increase distribution via more Trade accounts.

Valuation: Trading at a P/E multiple in the low 30s at the high end of its historic multiple – a premium reflecting its rare asset quality as IP-rich and vertically integrated with a core gross margin of c 70% and licensing gross margin of 100%.

Catalysts ahead: Potential news on the launch date of the next new edition of 40K if it follows the historical typical triennial release schedule.

what is next?

Drivers: Future growth is partly dependent on the phasing of releases of new editions of its two main IPs, typically every three years for each. Live action content with Amazon currently in development, likely to take several years to release. Work is almost complete on a standalone Age of Sigmar episode for Prime Video.

Current view: Share price has performed well, 30%+ over 12 months, as core profit delivery has surprised on the upside in this ‘off year’ for major new editions, as well as discounting some benefit from the partnership with Amazon.

What’s next: FY26 (end May) trading update next scheduled event and potential for further dividend announcements.