One of the better Drinks industry Investments/trades.

Certainly got Momentum in its favour and we have a bottom triangle/wedge formation breakout.

First resistance level at around 500p.



dyor

a brief analysis just picked up .....

Shares in this pub operator have not exactly blossomed over the past year, having hit a multi-year high towards the end of 2015. First half earnings are expected on 30 November. The most recent update saw like-for-like sales rise 1.7% for the 18 weeks to 4 September, an improvement over the 1.5% rise for the twelve months to April, and ahead of the broader sector. A brand improvement drive for key restaurants such as Flaming Grill and Hungry Horse should help boost the appeal. Full year earnings are expected to increase by 3% and 4% for the years to April 2017 and 2018 respectively.
At 9.8 time earnings, the shares trade on a relatively undemanding multiple (five-year average being 11.7). A 4.4% dividend yield also boosts the attractiveness of the shares. Some cost inflation from sterling weakness may compress margins, while the ongoing rise in the minimum wage will make itself felt in the sector.

Greene King's out-performance continues.

StockMarketWire.com

Greene King has reported another set of record results following continued market out-performance.

Revenue rose by 6.9% to a record £2,216.5m, and operating profit before exceptional and non-underlying items increased by 4.9% to £411.5m.

Chief executive Rooney Anand said: "Greene King has delivered another set of record results, generating full year EBITDA of over £500m for the first time.

but the market remains tiresomely underwhelmed

Drop over done?

To uncertain to say I would have thought in this sector.

At their current 565p I would agree CD, GNK has a terrific record for eps & dps growth, I'm not in these but have a holding in MARS which has dived on the GNK news, but better luck to all who hold.

Next week I will keep an eye on this one for a buying opportunity.

555p at close.

Like-for-like sales down 1.2% but sp down by 15%. Is this justified?

Like-for-like sales down 1.2% but sp down by 15%. Is this justified?

Still going down.

GNK keep going down and Weatherspoon keeps going up - why?

Weatherspoons operating margins seem far better.

GNK and MARS weaker today may be due to final results at MAB

INTERIM RESULTS FOR THE 24 WEEKS TO 15 OCTOBER 17

Business highlights

· Further outperformance from Local Pubs, Pub Partners and Brewing & Brands in a challenging first half

· Strong cost mitigation: on track to deliver £40-45m of cost savings

· Brand optimisation delivering return on investment over 25%; Fayre & Square to be debranded by year end as part of our plan to reduce our value food exposure

· Spirit refinancing under way: new facility agreed, bond prepayment announced
· Pub Company volume trends improved post period end after £10m investment in value, service and quality

Financial summary

· Pub Company like for like sales -1.4%, Pub Partners LFL net profit +1.5% and Brewing & Brands own-brewed volume +0.3%

· Operating profit before exceptional and non-underlying items1,2 of £188.4m, -7.5% below last year

· Strong cash flow and balance sheet supporting attractive and sustainable dividend; dividend per share maintained at 8.8p

· 4.2x net debt to EBITDA1,2; fixed charge cover 2.3x; securitisation headroom in excess of 30%

· Group return on capital employed2 of 9.0%, well ahead of weighted average cost of capital

more.....

Peel Hunt Add 513.00 625.00 600.00 Reiterates

Shore Capital Buy 513.00 - - Retains

Liberum Capital Buy 513.00 720.00 720.00 Reiterates

i'm afraid this is a stinker as the chart shows

CC Send an email to CC View CC's profile - 26 Mar 2018 11:47 - 7 of 10 edit this post
Hi,

What do you guys use to do long term research into specific companies?

i'm interesting in GNK. I can get all the financial metrics from various places, broker targets from EQ and some of the market expectation figures from FT and 4Traders.

However, what I'm really looking for is a investment analysis piece. I ask because the share price I consider excessively bashed up. I understand anything retail is out of favour, impact of minimum wage etc. and rising interest rates on EBITDA, but what I'd really like to read is a balanced piece.

I'm prepared to spend a couple of hours reading the accounts, trawling the internet and getting my information that way but if I could find a summary of what someone had already done that would be great.
Chris Carson Send an email to Chris Carson View Chris Carson's profile - 26 Mar 2018 13:03 - 8 of 10
Not sure if this is what your looking for CC. Google Phil Oakley Article on Greene King (Third one down) How to do a SOTP valuation.
CC Send an email to CC View CC's profile - 26 Mar 2018 13:44 - 9 of 10 edit this post
Thanks Chris.

What I'm looking for is more a rationale for the existing share price and why isn't being shorted continually.

When that article was written in 2005 it shows an EBIT of £256m and implied P/E of around 14. The share price was 795p then and Phil Oakley suggested fair value as 788p so recommendation of do nothing.

Since then If I believe the figures from 4Traders the forecast EBIT for 2018 is £378m, a P/E of 8 as well a 7% yield.

I'm trying to get into the heads of those that are shorting to understand the detail. All I can see is that the gearing is high, the sector is out of favour and (rumours) others are taking market share off GNK. I have already bought a small amount of MARS which is fairing far better. I found an interview with the CEO helpful and the accounts showed some efforts to diversify.

GNK I find nothing to interest me other than a battered up share price which seems to be covered in more batter than would be reasonable imho.
CC Send an email to CC View CC's profile - 26 Mar 2018 13:49 - 10 of 10 edit this post
Perhaps I can phrase it another way. I made alot of money over the last 18 months on ALD and SHAW because I was comfortable I understood why the share price was bashed up and that the rationale behind it was wrong.

I'm trying to do the same thing here.