The Motley Fool

This stock turned £5,000 into £50,000 in four years. Is it too late to buy now?

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

While small-cap companies can be more volatile than their larger peers, there’s no doubt that they can potentially make their shareholders a lot of money. Imagine making five or 10 times your money on a stock. It could literally be life-changing. With that in mind, here’s a look at an under-the-radar stock that has made bucket loads of cash for investors over the last four years.

Keywords Studios

After floating on the London Stock Exchange back in mid-2013 at a price of 123p, Keywords Studios (LSE: KWS) shares have enjoyed an exponential rise over the last four years, and now change hands just under the 1,300p mark. For investors who were on board from the IPO, a £5,000 investment would now be worth over £50,000.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

The £750m market cap company classifies itself as an “international technical service provider to the global video game industry.” The group works with some of the best known video game developers in the world, and helps to localise games such as Halo and Pro Evolution Soccer by translating the language and cultural references for international audiences.

With the help of a very aggressive acquisition strategy, the company has enjoyed prolific sales growth over the last five years, with the top line rising from €10.3m to €96.6m, a compound annual growth rate (CAGR) of an incredible 56%. Can this momentum continue?

Today’s half-year numbers certainly look quite strong. Revenue for the six-month period increased another 50% to €63.8m and adjusted earnings per share rose 55% to €0.132. Chief executive Andrew Day commented: “We have delivered another strong set of results for the first six months of the year as we continue to pursue our strategy of organic and acquisition-led growth as we build our global games services business.”

So is there still time to get on board or has the horse already bolted?

City analysts have pencilled in full-year earnings of €0.30, which at the current share price, equates to a forward P/E ratio of a high 48.6. While I don’t mind paying a premium valuation for a high-quality company, that valuation doesn’t leave much margin for error, in my view. Therefore, while Keywords Studios does look exciting, I’d be hesitant about jumping on board at the current valuation.


Trading at a less demanding valuation is cloud communications software and solutions provider IMImobile (LSE: IMO). The company helps its clients use mobile and digital technologies to communicate and engage with customers, and notable clients include Vodafone, O2 and Betfair.

I last covered IMImobile back in April, and at the time, the stock had just broken out into ‘blue-sky territory’ after clearing its previous high of 197p set in August last year. While the shares did temporarily rise higher, to almost 220p, they’ve since fallen back to the 185p mark.

At that price, the stock offers value in my opinion. With earnings of 11.6p expected for FY2018, the forward P/E ratio here is 15.9, which looks reasonable for a company that generated 15% organic revenue growth last year. With a market cap of just £113m, this is a small-cap growth stock I’ll be keeping a close eye on going forward.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

Click here to claim your free copy of this special investing report now!

Edward Sheldon has no position in any shares mentioned. The Motley Fool UK has recommended Keywords Studios. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.