Why did you buy that Stock? [Pumpkin Patch]

Pumpkin Patch Ltd [PPL.NZ] was one of my long term growth investments because I saw its potential for future growth to be exceptional but still some time off.

Pumpkin Patch and sell trendy kids clothing in 4 different markets and currently have over 200 stores.


Why did you buy that stock?

Why did you buy that stock? [Ryman Healthcare]
Why did you buy that stock? [Michael Hill International]
Why did you buy that stock? [Mainfreight]
Why did you buy that stock? [The Warehouse]
Why did you buy that stock? [Goodman Fielder]
Why did you buy that stock? [Auckland Airport]
Why did you buy that stock? [Sky City Entertainment]


The brand recognition is very strong and customers are very loyal to that brand. This is one of the main reasons why I purchased shares in the company. That is, while many retailers of children's clothing sell nice clothes at reasonable prices Pumpkin Patch clothing sells at a premium because of its branding.

Pumpkin Patch designers have also enabled the brand to continually be reinforced by constantly releasing new clothing designs and therefore keeping that competitive edge in the markets they enter.

I wanted to purchase shares in the IPO a few years back but waited to see a few years of results before jumping in. Of course profit has slowed over the last 12 months or so, most retailers have suffered from a global slowdown but growth for the company over the last 4 years has been good and entry has been made into Britain and America since their listing.

The expansion management impressed me and those that run the company have been doing a fine job taking the company to the world. America has been a tough nut to crack so far but it seems the slow roll out of stores in Texas and California has been managed well if store level results are any indication.

So good management, as it should be always, is another overriding factor in my purchase decision. They do the selling of kids clothing better than any other retailer in the world that I have seen and this is where I see the growth.

One thing I haven't covered in much detail in any of this series before, with the exception of Mainfreight Ltd[MFT.NZ] I think, is company culture.

Like Mainfreight, company culture at Pumpkin Patch is brilliant, you can see it in the way you are treated when you walk into a store and that culture is bred from management down. If a business has a great company culture its employees are happier, and that leads to better sales and an increased bottom line-you cant go past that when looking at a reason to buy a company's shares.

Another small reason to purchase, my wife loves the clothing and we are trying for a baby and she can shop for Africa!

Now I have held Pumpkin for about 2 years and at an average purchase price of about NZ$3.70, so at a current market price of less than half that, it hasn't been good in the short term but I am a long term man so wouldn't be adverse to buying more should my dividend account have some money in it.

Disclosure I own PPL shares in the Share Investor Portfolio.


Pumpkin Patch @ Share Investor

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Long Term View: Pumpkin Patch Ltd
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Discuss PPL @ Share Investor Forum

Download PPL Company Reports

Buy Pumpkin Patch Clothing

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Buy Bird on a Wire: The Inside Story from a Straight Talking CEO & more @ Fishpond.co.nz




c Share Investor 2008

PRIMETV PRESENTS: The Great Global Warming Swindle

Sunday, 1st June at 8.30pm

Watch TGGWS on the net here

Global warming is the biggest threat facing the world today, but not in the way you may think. The Great Global Warming Swindle blows the whistle on the biggest swindle in modern history. The theory of global warming has been postured as fact and as such does not need to be questioned but what if man’s CO2 emissions were not the cause of the problem? In fact there is overwhelming evidence, and has been for some time, showing that it’s solar activity that determines temperature.

Many solar scientists attest to the fact that during the late 20th century we experienced the highest levels of solar activity for centuries. Global Warming is the morality tale of the decade – politicians are eager to pander to middle class green prejudice, and are throwing vast quantities of public cash into scientific research aimed at supporting an unsupportable theory.

It’s a tale of scientists fearful of speaking out, of upsetting the funding applecart and jeopardising the many thousands of research jobs generated for them by the global warming scare.

WARNING: Content May Offend


**NB: there is a one hour discussion of The Great Global Warming with skeptics and loony believers alike. Leighton Smith, talkback host on Newstalk ZB is one of the skeptics !

There have been attempts from some devotees of Global Warming to appeal to the Broadcasting Standards Assc to have the programme removed so nobody can watch it. This is typical of the GW zealots who dont want others to see the the other, more believable side to the GW "debate".


Related Political Animal reading

Unstoppable global warming
Global Warning: Tax Iceberg Ahead
Kyoto critic comes to town - Sunday Star Times
Carbon Credit trading puts Global markets at extreme risk
Of Tulip Bulbs and Tooth Fairies
Ponder the Maunder - 15 Yr old Kristin Byrne explodes the GW myth

c Political Animal 2008

NZ HERALD: Latest political poll and Political Animal commentary

As election day draws near the gap in polling between the National and Labour party stays constant.

Budget bribes, small as they were, clearly didn't work and Labour will have to make them bigger and more plentiful as we near polling day.

They have already started by bribing 44 thousand public "servants" with another weeks leave.

Bet your bottom taxpayer earned dollar though, Labour are going to raid the taxpayer purse to try to get back into power. They did it back in 1989, when they admitted a pre-election $89 million surplus but after their election bribes and when the books were uncovered post election we were over 1 billion in debt!

Is anyone listening though?

New Zealand Herald Poll story

Budget fails to do the trick for the Government

5:00AM Friday May 30, 2008
By Audrey Young

Helen Clark ranks below John Key as preferred prime minister, according to the poll. Photo / Getty Images

Labour's tax-cutting Budget has had no immediate impact on its poll rating in today's Herald-DigiPoll survey, the first major poll that includes a large post-Budget sample.

The economy has moved into top spot as the issue most likely to influence voters in this year's election, just nudging out tax cuts, which is the second most important issue.

Labour has moved down one point to 36.2 per cent but National has also moved down fractionally, by 0.6 to 51.5.

The gap between the two main parties has barely budged from last month's poll: 15.3 points, compared with 14.9 last month. National would still be able to govern alone.

National leader John Key continues to poll just ahead of Helen Clark as preferred prime minister, 44.6 per cent to 42.3 per cent.

If anyone received a lift from the Budget, it was New Zealand First leader Winston Peters, who claimed significant gains for the elderly.

His personal ratings as preferred prime minister more than doubled to 6.7 per cent.
But that boost has not been replicated in support for his party (1.9 per cent, up 0.4 points)

On those figures, unless Mr Peters won Tauranga or another electorate, NZ First would not make it back into Parliament.

The poll of decided voters was taken over three weeks in May. Two-thirds of respondents were polled before the Budget and almost one-third (418 people) after it. The margin of error on the post-Budget sample is bigger than the pre-Budget sample.

The support levels for the parties changed slightly in the samples taken before and after the Budget. Labour was on 36.5 per cent before the Budget, and 35.3 per cent after it.

National was on 51.7 per cent before the Budget and 51.2 after it.

On the basis of this poll the Greens would comfortably get over the 5 per cent threshold and return to Parliament with eight MPs, two more than now.

The poll's pre- and post-Budget movements were more pronounced for Helen Clark and Winston Peters in the choice of preferred prime minister.

Helen Clark dropped 3.6 points and Winston Peters jumped 4.3 points in the post-Budget sample.

Overall, compared to last month's poll, Mr Peters is up 3.5 points, Mr Key is down 3.4 and Helen Clark is down 3.

Economic news dominated the headlines in May with the price of petrol passing $2 a litre and a lot of coverage on interest rates and stress on household budgets.

The Government announced a delay in including liquid fuels in the emissions trading scheme,which National announced it would not support.

The head of the Immigration Service, Mary Anne Thompson, resigned in disgrace. And Finance Minister Michael Cullen set out plans for $10.6 billion in tax cuts over three years.

Translated to seats in the House, National would get 63 and could govern alone.

When respondents were asked which issue was most likely to influence their vote at the election, 26.7 per cent said the economy, 22.5 per cent said tax cuts and 11.7 per cent said hospital waiting lists.

Mr Key said last night that the economic issues the country was facing were weighing directly on the polls. "On the back of that, the Budget doesn't appear to be having any major impact because the dominant factor is the economic malaise that is washing over the country."

Helen Clark could not be contacted.

* The poll of 1279 respondents was taken between May 5 and May 28 and the margin of error on the total sample is 2.7 per cent. The margin of error on the 418 polled after the Budget is 4.6 per cent. The percentage of undecided respondents was 13.8 per cent.

Related Political Animal reading

At least Robin Hood was honest: Labour will buy the 2008 election
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c Political Animal 2008

Peter Marshall deserves longer sentence

The sentencing of Peter Marshall, former head of the failed online broker, Access Brokerage, to 3 years jail today surprised me.

I was expecting a far lesser sentence and perhaps even home detention for a fraud Marshall perpetrated on small shareholder/customers, when he was CEO of the brokerage and it collapsed owing millions at the end of 2004.

Marshall's plea for leniency because of "poor health" showed all the hallmarks of fraud cases heard in the US several years ago over accounting fraud and dubious businesses practices but Judge Bruce Davidson wasn't having a bar of it.

Marshall really didn't deserve the courts leniency anyway as he pleaded not guilty and his defence argued his innocence all the way:


The Crown maintained the offending was significant and "took issue" with any suggestion of real remorse, as Marshall maintained he had done nothing wrong. Stuff.co.nz


While I was expecting a lesser sentence, I personally don't think 3 years is long enough. Marshall's lack of remorse clearly shows he hasn't learnt anything from his experience and for this reason alone the sentence should have started at 5 years.

We don't have to look much further than collapsing finance companies, and their advisors and Money Managers advocating their clients to invest in dodgy companies to see that financial markets in New Zealand are still largely the domain of the wild west.

We need a few more sheriffs (and judges) in this town to send the message, and make an example of those who would wish to part you with your hard earned moola in nefarious ways.


Related Share Investor reading

Blue Chip's Mark Bryers at top of shaky pyramid
Money Managers Saga-3 story wrap
Money Manager's First Step gives investors the middle finger

c Share Investor 2008