Computacenter (LSE: CCC) led the FTSE 250 Thursday morning (22 January) with an early 10% spike. It’s one of the mid-cap index’s best growth stocks of the past 12 months, with a 61% gain.
The driver this time is a sparkling trading update ahead of full-year results, announcing a 32% revenue surge at constant currency. The gains are mostly driven by the firm’s Technology Sourcing division, which saw a 38% gross invoiced income rise.
AI profit potential
There was one immediate standout for me. The update said: “We are particularly pleased with our execution in North America, achieving consistently strong growth throughout the year with both enterprise and hyperscale customers“.
Hyperscale customers — I like that bit. Nobody can have missed the AI technology surge. And along with all those souped-up processing chips and large language models, the business needs infrastructure.
Computacenter is all about providing the IT hardware — the computers, the networks, and all the rest — that the tech industry runs on. And much of the software to control it it all. It offers strategy, advisory and management services too.
Old-time investors like to hark back to the California gold rush days. Back then, some made it big and some went bust. But the traders selling the picks and shovels pocketed a bundle. Companies like Computacenter are the picks and shovels sellers of the AI revolution.
What next?
Full-year results aren’t due until 26 March, but it sounds like they should be worth waiting for. With this latest announcement, management said “We now expect adjusted profit before tax for 2025 to be no less than £270m, comfortably ahead of market expectations“. Analysts had been forecasting between £243m and £259m.
Net funds at the end of December reached £600m, excluding IFRS 16 lease liabilities.
Looking forward to 2026, the board also told us: “We exited 2025 in a strong position with a committed product order backlog across all geographies at the end of December which is significantly ahead of both our position in December 2024 and at the end of June 2025“.
Cheap at the price?
The biggest opportunity also brings what I see as the main danger. Never mind an AI bubble bursting, if there’s even a slowing of spend in the coming year it would could see investors turn away from tech stocks. We also have to be keenly aware that trade with the US is not exactly smooth sailing these days.
And Computacenter being a relatively small FTSE 250 company might make large investors less confident. But I think the share price valuation has enough safety to cover the risk. We’re looking at a forecast price-to-earnings (P/E) ratio of 20 based on the latest share price and my estimated update for the earnings consensus. I think that’s fair.
Investors who want a piece of the future AI pie, but with less risk than going for the leading-edge Nasdaq techies, might do well to consider Computacenter.
