WES - Wesfarmers Limited

[sammy84]

I think you'll find MTS is beginning to feast off the carcass that is the Coles market share, in certain areas.

So no, I don't think it really is a duopoly any more.

Is that in relation to food works? I know little about them. I am from metropolitan melbourne, and most of there stores are regional. Is the buisiness model similar to that of coles, and how does it have an adv?

Thanks

 

[michael_selway]

Coles is just too big and too bad for WES, I said game over man, game over.

When a good company takes on over a sh*t company, what left over is usually
the sh*t and nothing else.

Earnings and Dividends Forecast (cents per share)
2008 2009 2010 2011
EPS 179.5 251.0 249.7 233.7
DPS 200.0 200.0 207.0 200.0

Yeah not 100% sure which way its heading etc

thx

MS

 

[UMike]

Well its up over 13% the past few days....

Still slightly under valued imo.

Even with the current price the dividend is 8.2% fully franked.

 

[noirua]

Well its up over 13% the past few days....

Still slightly under valued imo.

Even with the current price the dividend is 8.2% fully franked.

The chart sort of shows a double bottom, though it looks like a cup and bottom, not sure that's quite so encouraging.

 

[sammy84]

Can anyone shed light on what just happened to the price of WES? In the last hour it has taken a little dive whilst the ASX has been gaining. I cant seem to find any information out there why

 

[ROE]

Market correct price as information come available ...

some food for though, America in 30 years in boom and bust, people did not spend less on food and non-durable goods (drink,food etc..)

but this time around, there is a massive cut back on non-durable goods
I say Australia will follow the same path due to massive house hold debt.

now WES holding Coles and paying a massive price for it you can only guess what happen to WES when we hit recession
not only that it's up against the juggernaut WOW ...

 

[Mr Capital]

Can anyone provide any insight as to how the retail sector, in particular Wesfarmers may go as the lead up to x-mas begins, given these interesting times.

Thank you.

 

[noirua]

Analysts views on the future of Wesfarmers from the ft:
http://markets.ft.com/tearsheets/analysis.asp?s=AU:WES

 

[Johno]

Why no WES?

Was just looking through the "Whats in your portfolio thread" and I see that im one of very few whos holding Wesfarmer.

Im aware that they have a bit of debt and the Coles thing is going to take some work, but still, i would have thought at the current prices of less than $20 that this would be a fairly low risk good buy?

Any thoughts?

 

[noirua]

Analysts views on the future of Wesfarmers from the ft:
http://markets.ft.com/tearsheets/analysis.asp?s=AU:WES

The above gives views on the now depressed shares of Wesfarmers. A bad case of indigestion swallowing Coles.

More important at the moment with just 8 days to go, yes, it's voting for Aussie stock Forums http://www.thebull.com.au/the_stockies/forums.html

 

[ROE]

Re: Why no WES?

Was just looking through the "Whats in your portfolio thread" and I see that im one of very few whos holding Wesfarmer.

Im aware that they have a bit of debt and the Coles thing is going to take some work, but still, i would have thought at the current prices of less than $20 that this would be a fairly low risk good buy?

Any thoughts?

Don't under estimate the burden of debt, you may have some great asset
but if your debt is greater I be more worry about debt.

As you can see company goes broke because of debt not because they make little profit

There is rarely any company that goes broke because of no debt, in fact most of these company prosper much faster... Takes WOW, awesome balance sheet and in time like these they prosper where their competitor may dies off and they continue to gain market shares and when the next bull arrive they are ahead of the pack.

debt isn't a bad thing but when you use it badly that is a poison pill for you and WES use their debt very badly

 

[Johno]

Just sold all of my Wesfarmer shares. I was just losing too much sleep over them. The job they have ahead of them with Coles is going to be massive.

Every time I go shopping at Coles, im amazed at the lack of service and the standard of the shops and staff. It really was a broken buisiness when they bought it at an inflated price. Although the debt isnt anything spectacular, in these times, its a little more than id like. This will be a good one for me to jump on board later on, but for now im looking elsewhere.

 

[noirua]

Wesfarmers report that production is back on target for 6.5 to 6.9 million tonnes of metallurgical coal in 2008/9 at the Curragh mine in Central QLD. Holdup was due to dragline and winch failure.

 

[hotbmw]

I read this on todays Marcus today report:

There is talk of Wesfarmers looking at a $1bn placement at $12 per share – would be a 26.6% discount.

 

[Colonel Klink]

Just wondering what thoughts are re future WES debt refinancing. With US rates heading toward zero or thereabouts, I would have thought this would be fairly positive, assuming someone is still lending!

Coles is seen as this great burden, and maybe it is, but I'm a shopper and as far as a supermarket goes, I don't give a rat's re basic groceries, if I'm at Coles or Woolworths. It is just about which is most convenient at the time.

This whisper about another capital raising at $12 seems a bit ugly, though. Any other sources on that ?
I hold both BTW
Cheers Klink

 

[prawn_86]

Coles is seen as this great burden, and maybe it is, but I'm a shopper and as far as a supermarket goes, I don't give a rat's re basic groceries, if I'm at Coles or Woolworths. It is just about which is most convenient at the time.

I wonder what % of people are like yourself, it would make for an interesting study.

Personally i think all coles stores are absolute ****e and will not go to one unless i absolutely have to. We buy all our fruit and veg from a grocer, meat from the local butcer, and the rest from Woolies. Coles has never impressed, poor quality and higher prices

 

[Colonel Klink]

Prawn.. agree with you. I am talking about your basic grocery lines. I go to specialty butcher , growers market for fruit and veg etc. it's all the stuff you sadly can't eat, but still seem to have stuff your cart with that I'm less fastidious about.

For example I live in Leichhardt, go to local shopping centre where said butcher and fruit and veg resides, not to mention excellent fish shop, grog and so it goes. There is a Coles there so I am not going to make a separate trip to another shopping centre just for the pleasure of shopping at Woolworths.

Not a chance

So I think,with absolutely nothing to back it up, it is about the location and what other shops that surround said store offer that makes the difference( to me)
Klink

 

[nomore4s]

I wonder what % of people are like yourself, it would make for an interesting study.

Personally i think all coles stores are absolute ****e and will not go to one unless i absolutely have to. We buy all our fruit and veg from a grocer, meat from the local butcer, and the rest from Woolies. Coles has never impressed, poor quality and higher prices

We have just moved house into a new suburb which has both a Coles and Woolies in close by (old suburb only had a Woolies).

We have tried Coles a few times now and the only thing better than Woolies is the fact we don't stand in line at the checkout for as long.

The fruit and veg, meat and general range is no where near as good as Woolies and it seems to cost us about an extra $20-$40 per shop. So it looks like we'll be standing in line from now on.

Will be looking to short WES if it can't get above $18.00 and then $20.00

 

[ROE]

Just wondering what thoughts are re future WES debt refinancing. With US rates heading toward zero or thereabouts, I would have thought this would be fairly positive, assuming someone is still lending!

Coles is seen as this great burden, and maybe it is, but I'm a shopper and as far as a supermarket goes, I don't give a rat's re basic groceries, if I'm at Coles or Woolworths. It is just about which is most convenient at the time.

This whisper about another capital raising at $12 seems a bit ugly, though. Any other sources on that ?
I hold both BTW
Cheers Klink

dude look at the Coles number it's doesnt stack up...
It doesnt matter if million people shop at Coles, if they dont make much money out of those people what the point?

I rather have 100 customers and make $100
then a thousand customers and make $70 bucks.

and you know why they go back to share holders for more cash at a massive discount ?

1. Company is crab, the lender wants a massive interest bill to cover their risk so cheaper to go to share holders

2. No one will lend them the money

3. Shareholder wont buy unless they give massive discount as the risk is too high.

Last year WES borrow money they pay 10%-11% for interest bill.

Until Coles can make some serious money, its a very very painful road for WES shareholder with their ROE going down the toilet each year and if Coles
turn out to be a real dog it's will takes WES down with it.

 

[johenmo]

DISC: Hold none of these. But work in an industry which sells to these guys.

WOW are a clear leader in the grocery wars. Coles are being challenged by Metacash (IGA, Foodworks etc). These three hold about 80+% of the market.

Doing business with them, WOW seem to have it more together. Coles should get out of the mire but it's going to take some time. As others have said, the debt is holding them back.

FYI - Woolworths in the UK (not related at all) have gone into receivership.


Woolworths set for administration

Woolworths has had a presence on the UK High Street for almost a century
High Street legend Woolworths has buckled under its debt and is set to go into administration, BBC business editor Robert Peston has learned.

The move will put tens of thousands of jobs at its 815 stores under threat.

The board of Woolies - one of the UK's oldest store groups - is meeting to take the formal decision.

Deloitte will be appointed as administrators to the store chain and also to Entertainment UK, which supplies DVDs to supermarket groups.

However, Woolworths joint venture with BBC Worldwide, publisher 2 Entertain, will not go into administration as it is owned by Woolworths' parent company. And all stores will remain open and keep trading, at least for now. Money has been ring-fenced so that salaries will be paid to staff as normal on Friday, a spokeswoman added.


What is the point of Woolworths?
Robert Peston's analysis


Our business editor says that Woolworths has been something of a lame duck retailer for years, losing market share against intense competition.

The company's weak position was also the reason why the government did not intervene to rescue it.

"Government policy is not to prop up lame ducks," our business editor said.

Peter Mandelson, the business secretary, had been in contact with the company on Wednesday, to ensure that if it went into administration, it would minimise the anxiety to its employees.

The company has been asked to do what it can to protect its pension fund, and keep its stores open if possible during the vital Christmas period.

The UK's Woolworths has no connection with several retail chains around the world that carry the same name.