Johnson Matthey Shares Jump Nearly 20% After Standard Industries Reveals 5% Stake

Narrow-moat Johnson Matthey shares rose 19% on April 29 after Reuters reported that Standard Industries had taken a 5.23% stake in the company. Recall that Standard Industries acquired W.R. Grace, a similar process catalyst company, in 2021. We continue to value Johnson Matthey ignoring any takeout situation as neither company is commenting on the investment. Consequently, the recent boost in the share price leaves the stock looking fairly valued, on our estimates. However, we do see value for aggressive investors in a potential acquisition scenario as we think the company could fetch up to GBX 3,400 per share, 55% upside from our current fair value estimate of GBX 2,200.