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Highlights

  • Oxford Instruments receives BUY rating from Berenberg, with a price target suggesting a 24.38% upside.

  • FY25 revenue crosses £500 million for the first time, with a 10.8% increase in adjusted operating profit.

  • A £50 million share buyback program and strategic divestment of the quantum business signal focus on margin expansion and shareholder returns.

Oxford Instruments PLC (LSE:OXIG), a leading global provider of scientific and high-tech equipment, has attracted positive sentiment from analysts, with Berenberg maintaining a BUY rating and a price target equivalent to AUD 51.36, which translates to a 24.38% upside from the current price (AUD 41.29 or GBp 2,010).

The company’s average analyst recommendation stands at 2.14 (BUY), underscoring investor confidence in Oxford’s strategic direction, robust financial performance, and margin expansion initiatives. The target price estimate, converted from GBp to AUD at an exchange rate of 0.021, currently sits at AUD 49.07, reflecting an 18.82% potential gain.

Record Revenues in FY25

For the year ended 31 March 2025, Oxford Instruments reported record revenues of £500.6 million, surpassing the £470.4 million recorded in FY24. This marks a 6.5% organic constant currency (OCC) growth, largely driven by the semiconductor and materials analysis sectors.

Adjusted operating profit rose by 10.8% OCC to £82.2 million, with adjusted margins improving 70bps to 17.8%. This growth was supported by operational efficiencies and a streamlined business structure implemented during the year.

The Imaging & Analysis segment delivered a margin of 24.7% OCC, hitting the upper end of the company’s medium-term target range, while Advanced Technologies achieved a margin of 4.5% OCC, up 360bps, driven by performance in the compound semiconductor business and a turnaround in the quantum division.

Strategic Moves 

The company’s cash conversion rate improved to 89% from 64% in FY24, reflecting disciplined working capital management. It closed the year with £84.4 million in net cash, despite allocating £15.4 million for acquisitions.

In a significant strategic shift, Oxford Instruments has entered into a binding agreement to sell its quantum business, NanoScience, for £60 million, of which £3 million is deferred. This sale will allow Oxford to sharpen its focus on higher-margin and faster-growing core businesses.

Additionally, the company announced a £50 million share buyback program.

Commercial Pivot Yields Dividends

Commercial clients now represent 50% of total revenue, up from 45% in FY24. This growth was particularly visible in North America, Asia, and Europe, with a successful strategic repositioning in China.

The total dividend per share has also increased by 6.7% to 22.2p.