Renishaw (RSW:LON) shares have been getting significant attention from investors lately, specifically from Alexandra Jackson, of Rathbones UK Opportunities Fund Manager and Indriatti van Hien, from The Henderson Smaller Companies Investment Trust PLC, in our last two CEO interviews.
Over the last year, Renishaw shares have climbed around 95%. Could they be a good investment for a Stocks and Shares ISA or SIPP today? Let’s take a look at the set-up.
What does Renishaw do?
Renishaw is a UK company that specialises in measurement, motion control, spectroscopy and precision machining. It’s also a leader in metal 3D printing, designing compact machines that produce high‑performance parts from metal powder.
Founded over 50 years ago, it serves a range of industries today including transport, defence, agriculture, electronics (semiconductors), and healthcare. Its goal is to help customers make better decisions, improve efficiency, and adapt as processes become more connected and intelligent.
Renishaw share price performance analysis
At present, Renishaw shares are trading for around 5,300p. At that share price, the company – which is in the FTSE 250 index – has a market cap of around £3.9 billion.
In terms of performance, the shares have delivered strong returns over the long term, rising about over 500% over the last 20 years. However, between early 2021 and early 2025 they experienced a rough patch, falling from around 6,600p to near 2,200p.
Why did Renishaw shares fall from their peak?
As for why the shares experienced such a large decline between 2021 and 2025, there are a few reasons. One is that a proposed company sale collapsed. In early 2021, founder and Chairman Sir David McMurtry and non-executive Deputy Chairman John Deer put their combined 53% stake in the company up for sale. However, in July 2021, the sale process was formally abandoned after the board failed to find a buyer that met their strict criteria for protecting the long-term interests of the company and this led to a sharp drop in the share price.
Another reason was margin compression and a drop in profits. While Renishaw generated revenue growth between 2021 and 2025, it faced an increase in costs due to inflation. As a result, its operating margins fell significantly (from 25% in FY2021 to 15% in FY2025). This led to lower earnings and a rerating of the stock.
Are Renishaw shares a good investment today?
Today, Renishaw appears to have quite a bit of momentum. This year, its updates have been strong.
For example, in February, it reported revenue growth of 11.5% at constant currency for the first half of FY2026. Encouragingly, operating profit margin was 15.7% versus 15.1% a year earlier.
Then, in April, the company advised that since its February update, it had seen particularly strong demand from customers in the semiconductor & electronics manufacturing and aerospace & defence sectors, with a further substantial expansion of its order book. As a result, it raised its revenue and profit guidance for the year.
May saw another good update with revenue rising 13.5% at constant currency for Q3. Here, the company noted that it was seeing continued strong demand from semiconductor & electronics manufacturing and aerospace & defence.
However, while this is all very positive, the valuation is quite lofty today. With analysts expecting earnings per share of 184p for the financial year starting in July, the forward-looking P/E ratio is about 28 at present.
For the stock to be a good investment from that valuation, we’d need to see further gains in operating margin and profitability. If we were to see further improvement here, the stock should grow into its valuation.
It’s worth noting that several UK fund managers are bullish on the shares at the moment. One such fund manager is Henderson Smaller Companies Investment Trust manager Indriatti van Hien, who sees them as a play on automation.
Another is Alexandra Jackson, who runs the Rathbones UK Opportunities fund. Jackson sees Renishaw as a beneficiary of the AI theme due to its tools for semiconductor manufacturing.
What is the stock price forecast for Renishaw?
At present, the average share price forecast for Renishaw is 4,469p. That is slightly below the current share price.
However, recently, analysts have been raising their targets. For example, on 18 June, UBS went from 5,500p to 6,100p.
Does Renishaw pay dividends?
Renishaw does pay dividends. The yield is relatively small though.
For the financial year ending 30 June 2026, analysts expect a payout of about 83p per share. That translates to a dividend yield of around 1.6%.
Who are Renishaw’s major shareholders?
In terms of its major shareholders, Sir David McMurtry and John Deer continue to hold around 53% of the company. Much of this stock is held via a company called Deltam Holdings.
Other major shareholders include abrdn, BlackRock, Baillie Gifford, and Capital Research Global Investors. Combined, these firms own almost 20% of the company.
Summary
Overall, there’s a lot to like about Renishaw shares today. The company operates in growth industries such as semiconductors and defence and operational performance is improving. On the downside, the valuation is a little high at the moment. But if margins continue to expand, the shares should grow into the valuation over time.
Pros
- A play on AI and automation
- Operational performance is improving
- Analysts are raising their earnings forecasts
Cons
- The stock is a little expensive today
- The dividend yield is low
- It operates in cyclical industries
Based in London, Edward is a distinguished investment writer with an extensive client portfolio comprising a diverse array of prominent financial services firms across the globe. With over 15 years of hands-on experience in private wealth management and institutional asset management, both in the UK and Australia, he possesses a profound understanding of the finance industry.
Before establishing himself as a writer, Edward earned a Commerce degree from the prestigious University of Melbourne. Complementing his academic background, he holds the esteemed Investment Management Certificate (IMC) and is a proud holder of the Chartered Financial Analyst (CFA) qualification.
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