Consumer discretionary
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Can Richard Umbers Turn Myer Around?
Tim Kelley
March 23, 2015
There has been quite a bit of press recently about the untidy start to Richard Umbers’ stint as Managing Director of Myer, and whether investors might expect better times to come. Confidence took a hit this week when the company announced a disappointing half year profit, and indicated full year numbers would be below expectations. And this just weeks after assuring the market that consensus forecasts were on the money. continue…
by Tim Kelley Posted in Consumer discretionary, Insightful Insights.
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One stock we had to get our hands on
Ben MacNevin
March 10, 2015
During reporting season, we were quick to build a new position in a company after seeing a much stronger result than we had forecast in our research. A large cash holding allows Montgomery Investment Management to be nimble when opportunities present themselves. continue…
by Ben MacNevin Posted in Companies, Consumer discretionary.
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Smashed. Look out Kogan, JB, Bing Lee and Harvey Norman
Roger Montgomery
February 24, 2015
Last week in Sydney’s Inner West and only meters from a homeless person’s humpy, a plasma TV sat on the footpath awaiting council collection. A large, flatscreen plasma TV. On the street. In the rain.
by Roger Montgomery Posted in Consumer discretionary, Insightful Insights, Manufacturing, Technology & Telecommunications.
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Good news out of The Reject Shop
Scott Shuttleworth
February 23, 2015
Following on from our last discussion with The Reject Shop (ASX: TRS) last November (located here) we had another meeting with Management, CEO Ross Sudano and CFO Darren Briggs, to discuss their progress to date. continue…
by Scott Shuttleworth Posted in Companies, Consumer discretionary, Insightful Insights.
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Two stocks worth a closer look
Scott Shuttleworth
February 18, 2015
As earnings season rolls on we’ve taken a brief look at two smaller stocks that may present attractive opportunities. Retail with excellent management and a logistics company that has set itself up a niche in Western Australia.
by Scott Shuttleworth Posted in Consumer discretionary.
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What we do and don’t like about Tassal
Tim Kelley
February 16, 2015
Atlantic Salmon producer, Tassal Group (ASX: TGR) has caught our eye recently. Although the business does not have a great economic track record, it appears that performance has been steadily progressing, following a period of substantial capital investment and management focus, and the half year result just released shows a continuing improvement trend. continue…
by Tim Kelley Posted in Companies, Consumer discretionary, Manufacturing.
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SAE it ain’t so
Ben MacNevin
February 5, 2015
Companies that can reinvest large amounts of capital at high rates of return are a rare breed. Such companies must be careful to preserve value when pursuing growth outside of their core competency, especially if management becomes distracted by new business opportunities. continue…
by Ben MacNevin Posted in Consumer discretionary.
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Kathmandu – Leverage works until it doesn’t
Russell Muldoon
February 4, 2015
For the past few months we have written regularly about the headwinds facing the retail sector. Numerous retailers have downgraded sales and earnings, which were subsequently followed by share price declines. On Monday however, one listed retailer separated itself from the pack with the most sobering trading update yet. Kathmandu (ASX: KMD) has historically been favoured by Montgomery Investment Management. Yet with a business model that has a high degree of operational leverage, we were quick to exit the position in 2014 as it became clear that the company would not be immune to the deteriorating industry conditions. We have discussed the concept of operational leverage on many occasions. Retailers are subject to high levels of fixed costs such as rent, wages and electricity, which means that any price discounting will have a profound impact on the bottom line: a one per cent reduction in gross margin can often translate into a five per cent reduction in earnings. continue…
by Russell Muldoon Posted in Companies, Consumer discretionary, Insightful Insights.
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Vocation, vocation, vocation
Scott Shuttleworth
February 2, 2015
After a review of the events leading up to Vocation Limited’s (ASX: VET) recent announcement (see here), you may just feel like a vacation. Events such as these can create utter destruction in the wealth of shareholders, which is unfortunate, however they also offer valuable lessons in what to watch out for. Below I’ve prepared a brief chronology of events for Vocation over the last 6 months or so. continue…
by Scott Shuttleworth Posted in Consumer discretionary.
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Did Christmas come at all?
Russell Muldoon
January 21, 2015
Following on from our anecdotal feedback we posted last week that Christmas trading came very, very late for retailers, the Australian Chamber of Commerce and Industry (ACCI) has trumped even our most negative expectations.
ACCI produce a quarterly survey of a group of businesses and their investing confidence. The latest survey for the December 2014 quarter described the all-important Christmas retailing period as “the worst for 23 years”. continue…
by Russell Muldoon Posted in Consumer discretionary, Insightful Insights.