DID you enjoy the feed as you can vouch it keep you ALIVE.. FUN TIMES..
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BRICKS, somewhere there is an asylum with your name on it :)
JMKC surely you mean not on the asylum but on the asylum's patient or inmates list
No wonder PH is not making any money...
Pizza bill's 16-year bounce
Richard Forbes' hard-luck story takes some topping - 16 years after bouncing a cheque for a pizza he found himself dragged in front of a Wellington judge, with no idea what his crime was.
...
In court he was told that his sin was the long-forgotten "bounced" $10 cheque for the pizza.
...
"Pizzas haven't gone up much in price, have they?" Judge Bruce Davidson said.
Same in Palmerston North Anzac day, 6.30 pm. The food was good (they were barely keeping up), but only two people on the counter. Spent about 15 minutes in the (not long) queue. When I left, the queue was still to the door. I heard one woman reply (when the counter staff said "enjoy your meal, see you again soon") - "not likely".
It really wasn't a good look. A couple more staff would have made it good food, friendly BUT ALSO FAST, service.
I must point out it was not only KFC that seemed to have misjudged. After the dawn service there was a bagel/coffee business open less than 100 metres from the cenotaph and a crowd of 3000 people. Number of staff? 3! Half an hour for a coffee. I spoke to the manager and she agreed she should have "perhaps" rostered on more staff!
I passed the Christchurch Riccarton Road KFC on ANZAC day around 1pm. I had never seen it so busy. I didn't go inside because I wasn't in the market for lunch, let alone KFC. But the drive in queue was spilling out onto the road, which is a rare sight since the longer queue path that was part of the site layout redesign. There didn't seem to be any car park places. There was a long queue inside as well, and all the dining tables in the main area looked to be occupied. Was this a nationwide phenomenon on ANZAC day, perhaps fed (sic) by other competitive outlets not opening because of public holiday pay rates?
SNOOPY
ALL this is good news for the till, KSC in AU is just the same there is NO lack of customers but here they hire more staff as required it will happen in NZ soon, As for pizza the quicker they shut the unprofitable stores the better sack the staff or move them to KFC the stock price is shore to rise when BRICKS gets Mr Chips money will double the holding yet again..
AS above this man is NO different as it seems bought the lot on credit and levering is for the birds but when the whole mob do it its a disaster as it has worked out, love ANZ to dump the shares on the NZ market boy we would be picking them up for NOTHING..
Has ANZ started selling the RBD stake?
I don't know if this is helpful or not but I actually work for the pizza hut(NZ) callcentre, so I know quite a bit about the changes to pizza hut at least.
Under investment strategies I read about speaking to the "lea ladies" etc, so I guess I am one of those in this perspective?
If this is not the case then ignore this post but if you have any questions about pizza hut feel free to PM me and if I can help I will.
MYSTERYBOX, Great name for a tea lady if i might be so bold. We would all like to know the secret recipe if you can lay your hands on it. Macdunk
Thats a coincidence , i was driving through riccarton with the other half at about that same time. She wanted to go to mcdonalds for some strange reason.
There was such a big queue we didnt bother. , so i guess it must be an anzac day thing rather than a mass conversion to chicken eating
There is no secret receipe, all pizzas are constructed in store, with the exception of the bases. The only mystery is what is included in the seafood swirl.. >.>''
I know the bases are only a great thick scone normally with a bit of melted cheeze burned into it. This seafood swirl is a mystery does it come with a couple of sardines and a bit of crunchy seaweed?. Feel free to let the cat out of the bag we are all friends here. Macdunk
I am doubtful there is seafood, but ill analyse the allergies chart and question my supers, this information is potential for a large SP movement, I understand the urgency ;p
Hi Mysterybox,
Have you worked in a call centre before this? If so I was wondering how the new Pizza Hut operation compares? Am I right in saying the call centre is all part of the new open plan office complex where everyone, management and workers, is all together on one floor?
Kind regards,
Snoopy
Mysterybox when do you get your one way ticket to Egypt
RBD moved their new HQ during FY2006-2007. The date of September 2006 sticks in my memory from something said at the last AGM. But that memory may be faulty.
I am imagining some kind of palace from your description Mysterybox, with glass elevators reaching for the stars! They have a separate wing for each of KFC, Pizza Hut and Starbucks? Perhaps that explains why their General and Administrative expenses dropped only $0.1m (around 1%) when the move was made to the new 'low cost site'.Quote:
You're correct, the floor plan is open and all managers/workers/team leaders work near each other, the offices (higher staff) are close also (same floor), the office circles around a centrepoint (lifts in the middle) with various teams located on either the north/south/east side (west = break room) oh and one small training area on the west.
Work conditions/atmosphere are excellent and the management/higher staff are always friendly, everyone knows everyone by name.
One question: Approximately how many "higher staff" (as you put it) are there at HQ? Do they all have secretarial support?
Mysterybox, do I detect you may be just slightly overqualified to be a 'career call centre person'? Perhaps you have some opinion on how well the office layout works for cross fertilization of ideas between the three company divisions? Does it actually work having three what some may see as reasonably disparate businesses (KFC, PH and SB) under the single 'RBD umbrella'?Quote:
I did a study on the callcentre operation as part of my management paper so I know a lot about the systems/efficiencies etc, I can imagine it would work very efficiently; the systems are well in place and the user interface is easy to adapt/work with.
SNOOPY
mysterybox would you like the Egyptian rates of pay
THINK Mr Mysterybox has had a burnout or his BOSS has got to HIM..
This is a very common thing with RBD. There have been several instances in the past where the "tossed salal" (coleslaw) has contained the additive ingrediant in your mayo to give it some extra spice. So what you are alluding to is very common. in fact testing done at peppermints inside the VIP room at SKC showed
similar traces and have since have wrapping over them
Hi utopian, can you further explain your logic?
You have just told us that this private company Phisci has 1.3% of RBD shares and wishes to acquire 23.5% of the company. Phisci will have to make a partial takeover bid to do that. Yet you still expect the RBD share price to fall???? What have I missed?
SNOOPY
discl: hold RBD
An interesting change in tone I detect from reading the RBD annual report today.
From the Chairmans report on page 9:
"the company's ability (is) to leverage off good brands- the essence of what Restaurant Brands is about - and confirms that the group is first and foremost a brand manager *not restricted or inhibited by its current brand portfolio.*" (my emphasis)
Later on page 9
"Directors will continue to review Pizza Hut's future and take whatever steps necessary to protect future *group* growth and profitability." (my emphasis)
Then on page 10
"*Directors and management will be redoubling their efforts to ensure it (Pizza Hut) ceases to be a drain on the group*. The directors will not shy away from making firm decisions over Pizza Hut in the interests of overall group profitability." (Chairman's emphasis)
Now we move on to page 13 and the CEO's report
"The bulk of Pizza hut stores come up for renewal in 2010and we are working with YUM restaurants international (the Pizza Hut and KFC franchisor) on renewal terms for the franchises on these stores."
Perhaps I am drawing a long bow here....
But reading between the lines I would suggest the 'corporate pizza cutter' has been taken out of Chairman Van Arkel's desk. And the blade is being sharpened for an FY2010 deadline!
Also in late paging news (page 64) former CEO Vicky Salmon has sold all of her shares in the company, at a significant loss.....
SNOOPY
discl: hold RBD
VICKY did not sell her shares at a significant loss. SHE GOT THEM FOR NOTHING FROM YOU MUGS. Look at all those dividends along the way all extra payment on top of a massive salary for running the company into the ground. If she had a significant loss what have the mug investors still in got?. Macdunk
Snoopy, could RBD just be upping the ante to secure more favourable franchise terms for pizza hutt when it comes time to renew the agreement in 2010?
I hope so Steve! RBD have been pretty weak negotiating with YUM before I think. Partly their own fault through using the KFC franchise as a cash cow to fund other expansions while neglecting KFC franchise development in its own right in New Zealand. This has been turned around with the KFC refurbishment program showing promise. Hopefully that will also strengthen RBDs negotiating position!
Pizza Hut in New Zealand is not alone in being a 'problem child'. YUM have recently taken back fully in house their Pizza Hut business in the UK, after reacquiring the 50% they didn't own by buying out their joint venture partner. It is YUM's intention to refranchise 300+ of these 500+ stores when market conditions permit.
In the US, Pizza Hut is (in market share terms) much weaker in the Pizza market than KFC is in the chicken meal market and Taco Bell is in the Mexican restaurant market. YUM are trying an interesting dual brand strategy with Pizza Hut in the US by launching 'Wingstreet' , a boneless and boned chicken wing and sauce offering that is projected by the end of 2009 to be America's largest wing chain.
YUM's strategy when deciding whether to own a store outright or on sell it as a franchise is as follows:
"If we can run our stores well and provide great returns for our shareholders , we'll own the restaurants ourselves. If our company operations are not getting margins that well exceed our cost of capital, we'll sell our restaurants to franchisees who can do a better job of running them." (page 7 YUM 2007 Annual Report)
then they go on to say
"We will be taking total US ownership down from 22% to possibly less than 10% by owning fewer Pizza Huts, KFCs.."
You can read into that how well Pizza Hut in the first world is doing in general. Of course in China, Pizza Hut is going great guns.
SNOOPY
discl: Hold RBD, YUM (U.S.)
A small but significant thumbs up for RBD on Fair Go tonight.
Their corporate response to the effective wage rates being paid by a third party to those "contractors" that distribute RBD flyers on their behalf was top notch. A good many other corporate citizens declined to comment, which won't do them any favours in the short term.
disc - normally don't have much time for Fair Go as they tend to sensationalise a good number of their stories, but IMHO this one struck the right note.
RBD has pick up in the last week to 87 cents and still CUM DIV, BRICKS is contemplating going to this years Annual meeting if they would state where its to be Held but over all now with the departure of Mr Chips Co, RBD is the only place to Sell them CHIPS..
Interesting to see that they have made note of the contraction in retail spending, which is continuing to decrease...
The decrease in sales is because of the closure of several Pizza Hut outlets. On a per store basis RBD sales are still increasing. OK the increase isn't great, and much (all?) of it is probably due to inflation. Nevertheless in relative terms, RBD is performing better than most retailers. Can you name a better performing NZX retail share this year? Off the top of my head I can't. Shareholders are getting an apparently sustainable yield of 11% gross and the share price has climbed back to the 87c or thereabouts it was at the start of the the year.
I'm not saying it is all plain sailing from here. Like most (all?) retailers, RBD still has issues. Overall I think the food sector will suffer less than many others. While top line restaurants might have a hard time the hard wiring of the 'convenience food culture' coupled with the surprising number of people that don't know how to cook means that turnover at the cheaper end of the restaurant trade is safe. Safe doesn't mean I'm predicting a quick further recovery in share price to $1. Nevertheless for the investor that values dividend income and wants a significant boost over what the bank might give them, I think they would be hard pressed to argue for 'no RBD' in the portfolio starting from this point.
SNOOPY
discl: hold RBD
I usually don't post in the RBD thread, but I've been following the company a little bit in recent years as well as the pizza market in NZ after having followed it in North America for some time.
It's my understanding that the pizza business in North America was always considered to be somewhat recession proof with enough room for national franchised low cost players(Dominos, Pizza Hut, Papa Johns, and Little Cesaers), national gourmet players(California Pizza Kitcken, Bertuccis), regional franchise players, and privately owned units.
In my opinion, the NZ pizza industry has gone from being quite under-developed as little as 5 years ago, to becoming quite competitive quite quickly with the existing Pizza Hut chain, Dominos very rapid expansion, rapid expansion of Hell Pizza on the higher end of the pizza food chain, and the entry of low cost private players like Big Pizza.
The serious concern I would have as an investor in RBD's Pizza Hut business is that profitability at the franchisee level is probably quite poor at the moment for the following reasons:
1.) Cheese prices...even bulk purchasing and hedging by a franchisor present a real problem.
2.) Rent...retail rents are only going in one direction.
3.) Staff...increased minimum wage, very low unemployment.
4.) Competition...market has gone from underserved to excess capacity in many regions eliminating any retail pricing power Pizza Hut once had when they were the only big player in the market.
Anecdotally, there are quite a few Dominos and Hells Pizza units for resale in a couple of the bigger markets.....if biz were that good, owners wouldn't be looking to leave.
It's analogous to the Subway franchise system..........Subway is very successful in NZ, but the franchisor has a habit around the world of putting Subways on every corner......increasing overall franchise system sales, but lowering average franchisee unit sales. When Subway opened in NZ, you had to pay BIG money to buy a resale unit......now that Subways are nearly everywhere, buying one isn't so expensive anymore.
And while looking at things from the coal-face franchisee's perspective may not be analogous to looking at thngs from RBD's perspective, those that ignore it for too long, do so at their peril.
Just my opinion on the Pizza Hut portion of the RBD business....I suspect Pizza Hut is going to get worse before, if ever, it gets better.
I made a jumbo sized pizza myself last week complete with mozarella cheese as part of the topping. The 100g of cheese I used on its own cost more than $6, just to do a single pizza!
Yes I agree, although if there is a bit of a retail downturn it might help in renegotiating some of those Pizza Hut delco leases. The largest number of Pizza Hut franchise ten year renewals happen in 2010. I have no idea if the actual shop leases contracts correspond to the franchise renewal dates though. But if management were any good, they should.Quote:
2.) Rent...retail rents are only going in one direction.
Yes, Pizza Hut isn't the only one 'feeling the competition'.Quote:
3.) Staff...increased minimum wage, very low unemployment.
4.) Competition...market has gone from underserved to excess capacity in many regions eliminating any retail pricing power Pizza Hut once had when they were the only big player in the market.
Anecdotally, there are quite a few Dominos and Hells Pizza units for resale in a couple of the bigger markets.....if biz were that good, owners wouldn't be looking to leave.
It is analagous. RBD are the franchiseeQuote:
And while looking at things from the coal-face franchisee's perspective may not be analogous to looking at thngs from RBD's perspective,....
SNOOPY
IF this is done in an orderly way and only keeping the Best there is a ground floor as the other brands are doing the same RBD will return to profit, If I had my way would shut the lot cant stand the stuff and it looks the same for Mr average KIWI..
Big Pizza has gone into liquidation - There was a fire sale of plant a few weeks ago. No money for any creditors. Check out 'thats amore' liquidators report on the companies site.
Yeah Matt Blomfield??? of Cinderella Advertising - apparently made up 8% of Hells turnover with his stores. Food costs of 40% he reckons - his comment was that if you think he closed his stores quickly, other franchisees will close 10 times faster. Life under TPP must be tough - a lot of ticket clipping I say.
Strange to see RBD sp up.
The result is not very good, why is the sp up?
Whats the rumour out there?
ps: have to say NZSE SSH notice looks like dog tucker!!! Cant even read it!
Here is the note my broker sent me on April 10th
----------
(RBD.NZ) Restaurant Brands - BUY (price $0.83)
Sector: Food and Beverages
Despite a good result yesterday, RBD has not moved, we expect to see
some appreciation of the share price in the short-term as the market
recognizes RBD's good performance.
---------
No rumour Doc. You have just been asleep for six weeks. Oh and the share is about to go ex a 3.5c dividend soon. But I guess if you are a member of the dividend deniers cult like some around here...Quote:
Whats the rumour out there?
SNOOPY
discl: hold RBD
You are obviously not a trader my Indian friend. Traders dont trade in companies with a low volume. Traders like to get in and out barely leaving a ripple in the share price. I blame the averaging down brigade, lets face it they are the only ones getting buy signals in a down trending share. RBD have been heading down for years, it must go up against the trend on the rare occasion, when the odd nutter invests a few thousand. Macdunk
What buy signal is that Hiawatha? Are you possibly referring to the trendline break of some weeks ago? Those that bought then would now be well in profit, but let's take a closer look at that signal. While there was a clear break of a trendline that had held for 3 years, the signal lacked confirmation. Look carefully at the On Balance Volume plotted here. See how while the 2 year long OBV downward trendline was broken back in February, this trendline break was caused by the OBV merely tracking sideways - there was no OBV uptrend such as would indicate a significant change in market sentiment.
http://h1.ripway.com/Phaedrus/RBD530.gif
Nah. It takes volume to excite a techie, Hiawatha. No volume, no excitement. Look at the histogram along the bottom of the chart. See how volume is in fact falling (marked by the heavy magenta line) as this little uptrend procedes? Remember that it takes volume to confirm a trend. This is evidence of a weak uptrend. You say "Perhaps the TA people are piling in". Nah - in fact no-one is piling in. Look at the falling volume.
I wouldn't scoff at technical buy signals if I were you, Hiawatha. Click here to see where skilled, competent fundamental analysts were buying into RBD on the basis of "value" and "good" dividends. (Bless their cotton socks!)
No contest!
Went in to the South Dunedin KFC, an upgraded store, to cash in my annual shareholder freebie and was greeted by their newly acquired "D" rating issued by the DCC on 29 May 2008.
The only positive that I can tske from this is that it must be a good 'D', otherwise they would have been closed down to clean up their act... :(
WELL RBD has 476 less KIWI owners in 2008 since2007 had 6669 now 6193 but most of the buyers are existing large holders with Director D Diab now 4,000,000 up from 3,444,300. ,,
there are also 10 Asian names in top twenty so must know where to make money in FOOD..
There is 166 Australian Holders down 3...
what caused the sp spiking to over 90cents
I do find it amazing the extent some go to to convince themselves that investing in RBD is a bad idea. We know about those that disregard dividends and so get the return calculations wrong. But there are plenty of other intelligent non investors on this very thread.
We have others who are 'afraid' to invest because they don't see hundreds of others piling in, (even though a couple of big spending Aussies have been busy climbing up the top ten shareholder list). We have still others who didn't 'believe' that the latest result was any good, despite the positive earnings lift and boosted dividend.
Now we have one of the country's most respected and rigorous chartists saying he wouldn't join the uptrend because it is only a 'weak' uptrend, so it isn't 'confirmed' (?) What happened to the 'higher highs' and 'higher lows' definition of an uptrend? I guess if you don't want to follow your own system, the answer is create a new measuring stick so that you don't have to (?)
I do have shares that I would struggle to exit over a week, but RBD isn't one of them. Nearly 22,000 share were traded this morning, and this is in a 'weak' uptrending market (uptrending for RBD shareholders that is, general NZX index investors aren't so lucky)! So while 'the many' dream up ingeneously creative solutions as to why they should not invest in RBD, those that *are* invested are now doing very nicely thanks. Trades were going through at 92c this lunchtime. That is up 15% from the 80c long term support level frequently visited earlier in the year. Good for those like me willing to take advantage of these price dips, and ignore what has gone on in the rear vision mirror.
SNOOPY
discl: hold RBD
Congrats to Snoopy and BRICKS for their RBD investments. I have been keeping a close eye on RBD. At present I still struggle to see the fundamentals coming through that will convince me to invest. The short term sp movement on Hell's Pizza potential liquidation will make investors take notice.
If RBD is smart they will use this opportunity to secure the top and med end pizza market. I will see how they will react and what strategies they adopt on the opportunity of HELL falling over. Till then I am still not convinced RBD has any strategy at all for Pizza Hut.
On a T/O value RBD, the current sp looks very cheap. But then the sale process have been around the block and no one wants it at the crazy price the directors are asking.
Still gonna wait and see how things pan out.
Anyone have a link to the NBR Hells Pizza article?
Snoopy it is very naughty of you to make false statements like that and attribute them to me. At NO stage did I EVER say that I "wouldn't join the uptrend".
No, it is a 'weak' uptrend BECAUSE it isn't confirmed. Volume confirms price, and volume has been falling.
That's unchanged, Snoopy. No-one is disputing the existence of a new uptrend. We are speculating here on its strength. Two separate issues.
I'm astonished to see you claim that I have "created a new measuring stick" just for RBD, Snoopy. Hardly! For many years I have been actively advocating use of the OBV indicator. You know that.
Ah, but Snoopy, you have been ignoring the rear vision mirror and "buying the dips" for literally years! Had you looked in the rear vision mirror back then you would have seen that you were (on all but one occasion) buying into a confirmed downtrend. The dips just kept on getting lower and lower - see this chart, for example.
The concern occasioned by the flat OBV as expressed in this chart proved to be very well founded. In the days following that post, the RBD shareprice fell away, it again broke below the trendline and made a low at 78 cents before reversing, breaking the trendline yet again and moving into the current uptrend. (With, you will notice, a rising OBV).
Snoopy: I think the moral of the story is: "Be sure that the bull has actually been de-horned before you venture into the arena!"
But I give you full marks for bravery.
Cheers!
More like "Make sure the Bear has been de-clawed before you enter the pit"!
Volume indicators such as Accumulation/Distribution, Price/Volume Trend and On Balance Volume are all quite similar. Nevertheless I did manage to find a point in RBD history where they were not quite aligned. You can see here that the A/D indicator totally missed the nicely timed 2002 "Sell" step that the other 2 picked up.
http://h1.ripway.com/Phaedrus/RBDstep.gif
Generally speaking, though, these three indicators are so much the same as to render comparisons all but irrelevant. Take a look at this comparative chart and tell me which volume indicator is "superior"!
http://h1.ripway.com/Phaedrus/MFTstep.gif
Given such a high degree of correlation, it would be silly to argue strongly for (or against) any one of these indicators.
No Phaedrus you didn't say, "I wouldn't join the uptrend" in those words However, we both know the process of investment is not tied up in the minuitae of semantics.
For example in what you wrote above you haven't *said* that you would never buy a share at the trendline break without a rising OBV. However, I don't think any reasonable person reading that paragraph would suggest that buying a share on the trendline break *without* a rising OBV would be inside your circle of comfort.Quote:
The concern occasioned by the flat OBV as expressed in this chart proved to be very well founded. In the days following that post, the RBD shareprice fell away, it again broke below the trendline and made a low at 78 cents before reversing, breaking the trendline yet again and moving into the current uptrend. (With, you will notice, a rising OBV).
Now Phaedrus, here is what you wrote six pages back, on a post dated 10th April which you subtitled: "RBD BUY SIGNAL!!!!!! Look Mum, no hindsight!"
Phaedrus wrote
"Dr Who,
For the first time in literally years, RBD has broken above its long-term trendline (blue arrow). It is quite possible that you are not the only one with fundamental concerns though, because this Buy signal remains unconfirmed, so far. Notice the dead flat On Balance Volume indicator (circled). There is precious little volume behind this event. Remember that volume confirms the trend. See how the trendline break was caused by RBD simply tracking sideways, rather than heading off Northward. Technically RBD is still in a downtrend, it is still making lower lows and lower highs.
Nevertheless, if you want some RBD, the time to buy just might be approaching - wait a little longer though. There is no hurry - is there?"
Then yesterday Phaedrus, you wrote
"No, it (the uptrend) is a 'weak' uptrend BECAUSE it isn't confirmed. Volume confirms price, and volume has been falling."
"That's unchanged, Snoopy. No-one is disputing the existence of a new uptrend. We are speculating here on its strength. Two separate issues."
OK, same story but with one key observational difference. The observation that RBD is now in an uptrend, albeit unconfirmed.
Now I'll reprise your conclusion from six pages ago from your post titled "RBD BUY SIGNAL!!!!!! Look Mum, no hindsight!".
Phaedrus wrote:
"Nevertheless, if you want some RBD, the time to buy just might be approaching - wait a little longer though. There is no hurry - is there?"
The above is the phrase I take issue with.
At that point the share price was 84c and when I wrote my post yesterday it was 92c. That may be just a few cents to you, but it amounts to nearly 10% of the company valuation. For those that bought in at the 80c support level at the time the results were announced on 10th April, the increase in share price has been more- 15%. The actual increase in operational EBITDA when the final results were announce was an EBITDA increase of 17.3%. From a fundamentalist perspective you could argue that belatedly, two months later, the market has caught up with the operational position of RBD. By ignoring this opportunity with your "There is no hurry - is there?" attitude you have given away almost all of the arbitrage available between after the result was announced (and the share price hardly moved) and yesterday.
If the OBV on RBD spiked tomorrow, perhaps you would then decide to buy? Perhaps it would be a good move? Only time would tell. But would it be a lower risk move because you are acting on a 'confirmed' uptrend, rather than just a trendline break? I would argue no. That's because ultimately you would be gambling on an *even higher* EBITDA performance or a PE rerating (a sentiment factor that is difficult to forecast ) in the medium term to justify your entry price. IMO, it is much safer to 'risk' your investment money on an existing EBITDA improvement that has already been banked which 'the market' hasn't noticed yet. By claiming there is 'no hurry' to act, you have given away 87% (so far) of the gains available to you on a platter!
SNOOPY
discl: hold RBD, and *did* buy more at 80c while RBD shares were trading around that 80c support point.
Snoopy, you are still being very naughty and continue to wilfully misquote me. Here's what I REALLY wrote on April 10th (Post #978, page 66) :- "RBD BUY SIGNAL!!!!!! Look Mum, no hindsight! RBD has been in a downtrend for 3 years, but this morning broke above its longterm confirmed trendline, giving a Buy signal (marked by the green arrow). The red dots mark where fundamental analysts bought, mainly on the basis that the shareprice at that point was well below RBD's theoretical "value". As circumstances changed, these valuations were progressively reduced, but the market price was always below RBD's calculated "worth", so the buying continued - all the way down. A simpleton with a chart, pencil and ruler would have done better. Wouldn't it make you spit?." That's it - the full text.
My next post was two weeks later on 23/4/08 (#997, page 67) by which time RBD had made a bearish double top formation and the OBV had demonstrably failed to rise. The breakout was not looking so good by then. That's why I advised those that were still wanting to buy RBD to wait a little longer. Good advice as it turned out, because RBD continued to drop right back to 78 cents, with the OBV falling quite sharply.
The "key observational difference" stems from the fact that this comment came 5 weeks after I had stated that RBD was "still in a downtrend" - by then the trend HAD changed.
Snoopy, here is a chronology of when and why people may have got into RBD on technical grounds :-
10/4/08 Trendline break. Entry at 84 cents. (Signal posted on ST before the Close)
18/4/08 Trendline break (2). Entry at 84 cents.
12/5/08. Trendline break (3). Entry at 81 cents.
14/5/08. Volume spike and rising OBV. Entry at 85 cents.
23/5/08. RBD now in uptrend. Entry at 86 cents.
27/5/08. OBV now in confirmed uptrend. Entry at 87 cents.
You need to compare these technical entry points with those based on fundamentals such as "EBITDA performance or PE rerating based valuations". Fundamentally derived "value" based entry points have given abysmal results with this stock. Here, for example, are some 2005 quotes from Snoopy's RBD posts, from a thread with the unfortunate title "RBD - Bad Sales numbers" :-
"Even at $1.65, the shares are still cheap IMO, which perhaps explains why I bought a few more RBD shares in the market today at $1.60."
"I'm picking $1.65 as below the bottom of the fair value range".
"My latest RBD purchase locked in a very attractive equivalent bond coupon rate of 9.3% (gross) on those new shares. I'll get that return on those funds whatever Mr Market does or does not do!"
"I'm not worried by a drifting share price." (I had been helpfully pointing out the fact that Snoopy was buying into a downtrend.)
"If the share price ever falls back towards $1.35, *that* will be the time to buy." (It did, and he did!)
Phaedrus, I wasn't willfully misquoting you. Those charts on successive pages (66 and 67) are effectively the same. Even you hadn't taken off the red spot purchase dots from p66 when you reposted the chart on p67 with OBV added. Nor had you removed the 'Average Capital Loss 25%, Dividend Yield 7%' graphics. Nor I would suggest should you have removed these things. Interchange the comments you made on p66 and p67 with the respective graphics and your main points still make sense. The only difference is that the p66 chart showed the first trendline break at 83c, and the p67 chart with the addition of a tiny squiggle (representing the time period from the first chart posted on 10th April and the second on 23rd April) shows a second trendline break at 82c. These tiny differences are real, but they make no difference to *my* F/A argument or what *I* was trying to say.
Yes, I never meant to suggest you changed your mind for no good reason Phaedrus. I only ever meant to suggest that the data had changed with time and you changed your observation accordinglyQuote:
The "key observational difference" stems from the fact that this comment came 5 weeks after I had stated that RBD was "still in a downtrend" - by then the trend HAD changed.
Yes you do, but not for the reasons you think Phaedrus. I introduced the 'EBITDA Performance Improvement' and 'PE Re-ratings' as possible reasons for the share price turning. These are not 'alternative' entry points I have dreamed up to be compared with yours. I know that you T/A exponents do not need to understand the reason behind stock movements. But as an F/A exponent, I *do* have to understand what is going on, or at least try to explain it as I see it.Quote:
Snoopy, here is a chronology of when and why people may have got into RBD on technical grounds :-
10/4/08 Trendline break. Entry at 84 cents. (Signal posted on ST before the Close)
18/4/08 Trendline break (2). Entry at 84 cents.
12/5/08. Trendline break (3). Entry at 81 cents.
14/5/08. Volume spike and rising OBV. Entry at 85 cents.
23/5/08. RBD now in uptrend. Entry at 86 cents.
27/5/08. OBV now in confirmed uptrend. Entry at 87 cents.
You need to compare these technical entry points with those based on fundamentals such as "EBITDA performance or PE rerating based valuations".
A 10% improvement in operating performance means the market will generally mark up the share price by 10%. If the market is very efficient you cannot make any profit out of this because the share price will have gone up 10% already, in anticipation of the result being 10% better. But the market isn't always efficient, because as in this case that share price rise took two months to happen. Thus the shrewd F/A operator had a value arbitrage play with RBD just sitting there for some weeks and no careful timing or use of T/A required. The use of T/A in this instance simply got you in at a higher price for the same reward, and thus a lower return. T/A was not helpful, *in this instance*.
Your argument that over the longer term timing your entry using T/A would have been better than simply buying an equal number of shares or dollar value at the 'red dot points' is fair enough. But as far as I am concerned that is a straw man argument, because that is not what I advocated doing and not what I did.
SNOOPY
Even Subway is going the way of the pizza chains and canabilising stores thru competition...
Subway franchisee faces bankruptcy
A Christchurch Subway store owner is accusing the multi-national sandwich chain of flooding the city with too many stores, bringing her to the brink of bankruptcy.
You post a link about Starbucks closing restaurants in the USA 'funguspudding'. Dare I suggest that this is a truffle pessimistic. The chain is planning to close a net 400 stores out of 16000, a total of 2.5%. And most of those that are to be closed have been opened in the last three years. This isn't actually that many stores, as a percentage.
RBD operate 44 Starbucks stores across NZ. Last year they closed 3 stores, which represented 6.4% of the NZ total. So the cutbacks in NZ have already been far more drastic than those which are proposed in the US, in percentage terms. What is more EBITDA profitability improved from $3.6m to $3.8m in NZ, despite those store closures.
You could argue RBD are ahead of the overseas trend already. I don't believe your implied forecast of a further 'retreat' for Starbucks in NZ is justified.
I am not sold on RBD's involvement in Starbucks myself. That's because I believe that after corporate costs are taken into account, Starbucks in NZ is loss making and has been since FY2005. This isn't the fault of the Starbucks 'concept' as such. It is IMO a result of Starbucks being 'top heavy' in management in New Zealand, and the holding company carrying too much debt for the Starbucks sub concept to be profitable. I think RBD has already streamlined some KFC and Pizza Hut head office management. Perhaps they should do the same with Starbucks? Or perhaps Starbucks can not inherently generate sufficient profits to have a third party corporate (RBD) clipping the ticket on the way through?
I am bemused by the Starbucks strategy myself. In Christchurch the three central city stores are all within five minutes walking distance of each other. That surely must result in sales cannibalisation. Yet all three stores seems to have a steady trade of customers each time I pass them. And this is exactly the kind of store distribution that 'works' in large overseas cities, which have a Starbucks on each corner.
SNOOPY
I don't wish to make a big deal out of this. But your question in the header was:
"Sign of things to come?"
My concise Oxford (1) Definition of the word forecast is: 'conjecture beforehand'. That is exactly what your header is - a forecast by definition! Granted you did not say whether you 'agreed' or 'disagreed' that the retreat of Starbucks in the USA will flow through to N.Z.. But consider this:
1/ You posted a link that makes a point and raise the conjecture "Sign of things to come?"
2/ You make no further written qualification on your referenced listed link.
I think 99% of people would assume you agree with the facts in the linked article and you believe the decline of Starbucks in the USA is directly relevant to a future decline of Starbucks in N.Z., especially given you posted on this RBD thread.
*I* certainly thought that was what you meant.
Bricks titled his reply post "Nothing To Do With Nz.. " so he obviously thought your reference was posted because you thought it relevant to N.Z..
Deev8 titled his reply "How bad will it be for Central Ohio?"
Then said in his post
"Details on how the closures will affect Central Ohio, which has more than 90 shops and kiosks, weren't available." *We will be on the edge of our seats awaiting those details.*
That highlighted piece between the asterisks indicated sarcastically that whatever happens in Central Ohio is likely to be of little relevance to N.Z. (so Deev8 thought you were thinking of your article as a portent to what could happen in N.Z.)
Go back to your post 'funguspudding' and see if it could have been interpreted in *any other way* than the way myself, Bricks and Deev8 interpreted it.
If you were trying to present any alternative interpretation you would have to have presented your linked message in a more different way. I don't think my own comprehension skills have failed me in this instance.
SNOOPY
I have a bone to pick with you Bricks (or should that be a stone?)
WILL YOU PLEASE QUIT BUYING RBD SHARES!
I am waiting for the price to go lower into my buy zone, willing it down, down, down and it never does get there. So just quit buying will you!
Funnily enough for all the flack we have taken over the years Bricks, over the last two years RBD shareholders have done quite well as the rest of the retail market has melted down around them. Who would have thought two years ago that RBD would turn into the best (NZX) retail investment of all!
Well two years ago I knew that it would turn out like that eventually, but I didn't know when and I didn't expect it to be 'number one' so soon. It is nice to be enjoying the payoff from all of those (now) increasing dividends at long last!
I went into my 'local' last week to cash in my shareholder freebie burger voucher. I thought I would try some 'wicked wings' as a side but was told they had sold out! Looking around there didn't seem to be a shortage of customers although come Sunday night there was no free newspaper to read (do KFC still have those?). The menu seems to have got simpler since the last time I went to KFC. There is no sign of the "twisters", for example, and there was only one kind of chicken on offer (I see that RBD have reintroduced the option of bonesless fillets this week). All good news in terms of streamlining the ship. Was it my imagination or were they turning the customers around faster?
But in more bad news for my buying program, RBD was up another 2c today. Arrrgh!
SNOOPY
discl: hold RBD
According to the 'Sharechat' charts the price two years ago was $1.10.
Actually you are right Macdunk. I was looking at the one year chart where the share price was 80c a year ago. It is now 86c and add to that the 6.5c of dividends received over the last 12 months makes a total of 92.5c. That is a 15.6% return after tax. Not too shabby at all, and it beats you Australian cash holdings which is of course the main thing :-).
Come to think of it though, even though I was looking at the wrong chart, the two year return is still -7.5% per year. I think I might still be right! Is there any NZX retail share out there that has performed 'better' over the most recent two year period?
SNOOPY
Sorry to say SNOOPY you should learn to read charts. If you go to direct broking site, get into super charts look up rbd over a two year period from today it starts at $1-25. You might be interested to know that MHI is about where it was two years ago, which is still a dead loss in the uptrending market we had during that time. Take into account some of us more than doubled our money in that period with the more astute investors taking their money to Australia, and sitting on a 13% exchange gain in that period. I have told you for years now that you will end up losing the lot on this dog of a company. The straw that broke the camels back was when they sold the kennels to go on that overseas trip, leaving them paying rent in this the bad times. Incidently i am sitting out the market this year, after predicting the market would downtrend leading up to a crash. Know when to play the game SNOOPY, and know when to stand aside, learn a sell system or you will go under bleating about how right last years fundamentals are. Macdunk
Hmmm, you seem to be right. I am too though. The sharechat two year chart definitely shows $1.10
OK, so one retailer has outperformed RBD. Good on ol' MikeQuote:
You might be interested to know that MHI is about where it was two years ago,
Are those the same astute investors, that after doubling their money in the first year, then invested in PEM which subseqently declined from over $3 to just 67c as of yesterday in just twelve months? A near 80% decline?Quote:
Take into account some of us more than doubled our money in that period with the more astute investors taking their money to Australia, and sitting on a 13% exchange gain in that period.
That would give a two year return on capital of: 2 x 0.2 = 0.4
IOW a net result of losing 60% of your investment capital in just two years. Perhaps Macdunk you are referring to a new meaning of 'astuteness' with which I am unfamiliar?
And IIRC these same astute investors got their original seed capital by selling out of PGW on the NZX, which over the comparable two year period produced a return of +80%?
Oh it hasn't been an easy market. I have made some big losses and some big gains this year. Overall though my NZX investments are about even. I haven't seen losses anywhere near those that most investors on this forum seem to have suffered. And meanwhile those dividends just keep rolling in! I think I have a good chance of outperforming Aussie cash over the next 18 months by just sticking to my NZX knitting.Quote:
Incidently i am sitting out the market this year, after predicting the market would downtrend leading up to a crash. Know when to play the game SNOOPY, and know when to stand aside.
SNOOPY
discl: hold CEN, LPC, NZS, PGW, RBD, SCT, SKC, TEL, TUA
DOUBT the price will go below .83 cents that's my bench mark if it does Great BUY,,
At Rotorua has two stores KFC one Palm Springs has been done over and full of Happy faces,
Well in the main town is indeed of a need for a work over a lot of money has passed over the counter there but always full Japs and things as the stores are out for three months this store may be down the List..
AS for Mac Duck the quicker he finds out a "DOG" is what humans take for a walk so they can mess up the place and nothing to do with RBD..
SNOOPY, Thats why the more astute investors have stop loss systems to save them from themselves when they buy a stock that goes the wrong way. look at the ammount of money you have lost riding RBD down over the years bleating about dividends buying more and more, which is worth less and less. Nobody ever gets it 100% right all the time at the buy time, the idea is to take the small loss admit your mistake to yourself and dump the company. The market is now starting to crash you would be well advised to change your methods before its to late. Macdunk
Maybe punters listening to Tony Alexander and some comments he made about the take aways sector last week
http://www.bnz.co.nz/binaries/w100708.pdf
Comments like
Sales in the March quarter were down a very large 9% from a year earlier .... and .... Our analysis suggests takeaway sales may have seen their worst cyclical rate of decline already and activity could now flatten out at best ........ Good growth as such is unlikely before early 2010
Just for whats it worth
WE have not heard you moaning for sometime and yet you have not stopped eating your KFC.
Well it was a good try with lots of pagers about cafes & take a ways but its was just a general state of the whole nation eating habits and guess what not one word direct about RBD trying to tie by suggestion but it DID not work, share price fell yesterday as there is NO buyers for any stock and NSX turnover is at a low ebb, again a good moan but we knew that ANYWAY..
Yum brands (im a holder) Came out with a very good result today , they are the owners of KFC taco bell and pizza hut and a few other high profile brands. They are achieving massive growth in china.
There was one dark cloud in their result
"Meanwhile, operating profit in the U.S. fell by 12 percent to $168 million, which the company blamed mainly on commodity inflation along with weak sales and profit results at KFC."
Looks like its not just here that KFC is under pressure
Sorry BRICKS if i am getting to far in front of you to keep up. I only asked you a simple question so perhaps i will break it down to make it easier to follow.
1, Three years to the day RBD was $1-60.
2, Two years to the day RBD was $1-22.
3, One year to the day RBD was 80c.
4, yesterday at close RBD was 74c.
Surely even you can work it out what the next question might be from that.
Your old mate Macdunk having some fun with you thick one.
LOL... RBD wont go under mate. I am actually keeping a close eye on this pup. I would like to see a strategic plan for Pizza Hut before I invest in RBD. I am wondering why is it taking them so long to get a plan (if any) for Pizza Dog Hut?
disc: not a shareholder yet
Was thinking about RBD this morning , conclusion i reached was that why bother when you can buy the parent company instead? .
Where is the grwth in RBD going to come from? The local takeaway market is already saturated. Only one i like the look of is Nandos . (who owns them?).
For sales to drop 9% in a mature market is significant. On top of that they have problably increased their RSP as the cogs would have skyrocketed. Therefore volume has probably decreased by more than 9%.
Unless there is a magic wand or something others can see that i cannot, i can only see one way the sp can go.
I was stating Tony Alexander whoever he is. How true it is i do not know so i therefore stand to be corrected.
Had a lunch with a fellow punter on Monday. I couldnt believe he had RBD. Loved it due to the yield. THe old argument...yield.
(Yield...Talk to people about telecom. Yield...$6..5..4...3?)
Told him to buy TEX....and then I realised I had advised him to buy the only 'gambling' stock I own. So I got hold of him and told him what I should have empasised.
DYOR
That 9% fall BNZ economist Tony Alexander mentioned relates to the takeaways sector in the Retail Trade Survey from Stats NZ .... ie all takeaway outlets
He made no mention of RBD but as several have pointed out KFC and PH have a large share of this sector so total sector perfprmance is some guide as to how RBD are and will do .... but the RBD will say that they are gaining share in the sector