Forum Archive Index - August 2000

[dskul deisel <bennie64@yahoo.com>]

Clearly the performance of Wrightsons today shows that
the old economy stocks still have life in them..My
simplistic anaylsis of Wrightsons is that it has a
turnover of $525,000,000, no debt and a potential EBT
margin of 8 percent ( same as Williams and Kettle's).
With close to 130 million shares left after the
buyback this means that at PE of 7 there could be an
upside of $1.50. No, not this year folks, but if the
commodity prices hold then its quite possible next. 
Greg Kay put this company through the wringer
backwards and it now seems to be unwringing itself.
Other things in Wrightsons favour are the commodity
prices, the weather, and farmers aren't complaining.
Another interesting scenario for Wrightsons would be a
re-capitalisation.  Because it has no debt it could
take some on and pay its impoverished shareholders
some capital back. With GPG in there mixing things up
this is a real possibility.  So you could see a return
of capital replaced with debt and a return to profits.


disc = own some


--- "tennyson@caverock.net.nz"
<tennyson@caverock.net.nz> wrote:
> >
> > It's hard to see what would cause the shareprice
> to fall in the
> > next year or so, other than the usual suspects. ie
> global
> > stockmarket crash or some natural disaster weather
> wise.
> >
> I can think of 3 reasons;
> 
> 1/Major shareholder GPG unable to find synergies
> with another rural 
> concern causing an overhang of stock in the market. 
> What *really* 
> are the synergies between Enza and Wrightsons for
> instance, other 
> than the fact they are both 'rural'?
> 2/NZ dollar starts to track upwards again.  
> 3/sudden decline of bees 'mite' cause crop
> pollination problems.
> 
> SNOOPY
> 
> 
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