Forum Archive Index - March 2001

["Dannie Hawkins" <dannie@es.co.nz>]

Hi Peter

 

There is no question that RBD is subject to variation in the NZ economy, or that they are PR experts - their whole sales operation depend on it. That is why the shares are half the price they were at their peak and why there are so many bitter analysts bagging them now (many having recommended or purchased them at higher levels)

 

I have found them to be above average on keeping the market informed. They even issue quarterly reports. The latest (8/3/2001 before the NBR article?) mentions that same store KFC is down 3.5% but margins are up. They hope new product will increase sales.

Same store Starbucks is 8.4%.

 

Will they disappoint in the future - sure thing (they are cyclical).

Is there growth potential - yes especially in pizza and coffee and liquor.

Are they profitable - yes.

Are divs sustainable - almost certainly, look at the cashflow.

Are they cheap -?? AMP thought so at $1.25. Divs and PE look attractive.

 

Only time will tell

 

All the best

Dannie