Even with UK shares hitting record highs in 2026, there are still plenty of quality stocks to buy for investors who know where to look. Even with the defence boom, most investors have rushed towards the largest players, but many are running straight past the niche specialists quietly delivering exceptional returns unnoticed.
Here’s one I’ve just bought.
A niche giant hiding in plain sight
Goodwin‘s (LSE:GDWN) one of the most remarkable businesses most investors have never heard of. The UK-based engineering group makes high-integrity castings, pumps, valves, and radar systems for some of the most demanding environments on the planet. Think nuclear power stations, defence installations, LNG facilities, and offshore oil and gas projects.
It isn’t a glamorous enterprise. But the financials certainly are. In the six months to October 2025, Goodwin delivered a 27.4% revenue increase to £135.6m and more than doubled its trading profit from £17.1m to £37.2m.
Meanwhile, gross margins expanded from 43% to 49.3%, reflecting the enormous pricing power embedded into its highly specialised, hard-to-replicate products. For reference, the average profit margin for most of its peers typically lies between 25% and 35%. In other words, Goodwin’s one of the most profitable businesses in its sector.
And yet, there’s more growth waiting in the wings. The firm’s official order book stood at £288m as of February. But in reality, the group’s true pipeline is considerably larger.
Due to the defence and nuclear decommissions procurement process, contracts are awarded in stages. But since suppliers have to undergo lengthy and rigorous qualification, once Goodwin gets involved in such a programme, it almost gains a near-de facto win on future stages.
Is this too good to be true?
The key word there is ‘almost’. The firm actually recently lost a tender for the Sellafield nuclear decommissioning project worth over £45m. Considering it’s one of the few companies in the UK capable of delivering the engineering expertise, the announcement came as quite a shock. And the impact was only compounded by the further loss of another €18m coastal radar project in Estonia.
It goes to show that while Goodwin has a strong incumbent position, it isn’t 100% immune to competitive disruption.
The geopolitical backdrop adds another layer of uncertainty. While war drives up defence spending, it also has a habit of interrupting trade. And with the ongoing conflict in the Middle East, some of its LNG valve customers have delayed their orders, creating a temporary but meaningful disruption in the region.
So now the question is, are these risks worth taking?
Why I decided to buy
The headwinds that Goodwin encountered in 2026 have undoubtedly been frustrating for shareholders. But with the share price being sold off hard, it became clear in my mind that the market drastically overreacted.
Even with the Sellafield tender losses, management confirmed that trading performance remains in line with expectations. And when looking out to the longer term, the group still has a strong pipeline of nuclear, LNG, and defence work building behind the scenes.
So with the growth story still intact and the share price tanking in March, I confidently added this business to my own portfolio. And for other investors looking for top-notch stocks to buy, Goodwin may be worth considering.
Should you invest £5,000 in Goodwin Plc right now?
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Zaven Boyrazian owns shares in Goodwin.
