Victrex Navigates Volatile Market With Higher Prices Offsetting Volume Dip; Shares Undervalued

In its first-quarter trading update, narrow-moat Victrex reported revenue of GBP 78.8 million, up 6% year on year. Volume levels of 948 metric tons were down 8% and below our growth expectations of 3% for the full year. However, the average selling price of GBP 83 per kilogram was ahead of our expectations, increasing by 14%, which helped to counteract the decline in volume. Management remains confident of its expectations for the full year. Although there may be slight adjustments to our price and volume estimations for 2023, we don’t anticipate making any significant changes to our GBX 2,100 fair value estimate. Shares traded down around 2% intraday. The shares look undervalued at current levels.