Originally Posted by
Beagle
Nobody is disputing Rod Duke's retail expertise however on a trailing PE of 17 and with the same procurement and logistical challenges as other retailers I feel Briscoes is fully priced in the circumstances.
WHS is a classic turnaround story. They've stripped a lot of cost out of the business (700 staff last year) and talk of a flatter management structure. Overhaling their inventory management systems, store within a store with Warehouse Stationary, possible retail footprint rationalization, (WALT of stores is just 4 years) and a range of other initiatives some of which will hopefully be eps accretive.
I would rather invest in a turnaround story on a current year PE of around 6.5 than pay up handsomely for perfection. Benefits have increased and many other Kiwi's will be doing it tougher in the years ahead with rising interest rates and that will drive them to make value buying decisions.
I think international travel is unlikely to revert to 2019 levels for many many years and people will spend that money here instead.