UK growth share Raspberry Pi (LSE: RPI) is having an incredible run at the moment. Year to date, it’s up about 233%.
Should investors consider this technology stock for their portfolios? Let’s discuss.
I should have been more bullish
I last covered Raspberry Pi – which designs and develops high-performance, low-cost, single-board computers (which people are using for agentic AI) – on 10 May. At the time, the stock had just shot up from £3 to over £7 in the space of about six weeks and I said that I didn’t like the risk/reward set-up after that pop.
Now, the funny thing is – it did actually see a pullback shortly after that article so I was right to be cautious. It fell from £7.20 to £6.30 – a decline of over 10%.
But since then, it has gone on another run higher. Today (5 June), it’s up about 20%.
As I write, it has just touched 1,000p so we’ve now seen it more than triple since the end of March. Maybe I should have been more bullish here considering the low free float (only 38% of the company’s shares are available to trade)?
What’s behind today’s surge?
As for what’s driving the gains today, it’s a trading update. Here, the company has advised that trading in 2026 has been strong, with profitability “materially ahead” of the comparable period last year.
It now expects to ship 4m units in the first half of the year and generate adjusted EBITDA at least $38m. It says performance has been supported by continued growth in unit volumes, a favourable product mix, and the ongoing utilisation of low-density DRAM inventory accumulated last year.
Looking ahead, management now expects full-year EBITDA to be “significantly ahead” of current market expectations. This is obviously a major positive for investors.
That said, the update isn’t flawless. It should be noted that it says unit economics are expected to moderate in the second half of the year as inventory of memory procured at a lower cost in earlier periods is depleted — in other words costs will rise.
Worth a look today?
As for whether it’s worth considering today, I think investors need to weigh up the bull case versus the bear case. Here’s a snapshot of each:
The bull case:
- Raspberry Pi has cool technology that is clearly in high demand (due to AI).
- Business performance is strong and the company just raised its full-year guidance.
- The stock has a low free float meaning that it pops when buyers come in.
- It’s one of the few tech hardware stocks in the FTSE 350.
The bear case:
- The price-to-earnings (P/E) ratio is high – the trailing P/E ratio is about 70.
- The stock has tripled in months so it could see some profit-taking if markets get volatile.
- It’s generally a volatile stock – this year it has already had three 10%+ pullbacks.
- There are risks around memory costs and future demand for its computers.
Weighing both up, the stock is too risky for me at current levels. However, it could be worth considering if someone is looking for a high-risk, high-reward play on agentic AI, especially if it pulls back a little.
Should you invest £5,000 in Raspberry Pi Plc right now?
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Edward Sheldon does not hold any positions in the companies mentioned
