Dominos poised for another slice of Pizza Hut

With the latest push by Domino's Australia [DMP.AX] for more market share released today it might well be worth another look at the hapless Pizza Hut.

Restaurant Brands [RBD.NZ] the operator of the Pizza Hut Brand in New Zealand, must be wondering what they can do next to stem the flow of customers from their doors to that of their main competitor Domino's Australia which operates 76 stores in New Zealand.

Their American style advertising, where they compare the size of a large Domino's pizza to theirs(see below) smacks of a little desperation and,well, it isn't working. Domino's are still kicking Pizza Huts oily little backside in the food quality, service and price areas of the pizza business.

Customers simply like the way Domino's does its business and they are voting with their feet.

This leaves Pizza Hut management with a big problem.

What do they do next to regain their lost sales?

I doubt whether management have the answer, for they have been trying to regain their lost mojo since Domino's entered the New Zealand market in 2003 and started getting a big slice of the action from the get-go.

I do recall a rather blase' reaction to Domino's arrival along the lines that Pizza Hut was such a dominant and strong player any new entrant was going to find things very difficult in "their" market.

This has been the hallmark of their reaction to competition until very recently and it seems it has been increasingly hard to shake that complacency.







Restaurant Brands @ Share Investor


Domino's Australia Dominant in Australasia
RBD consider slicing off Pizza Hut
Restaurant Brand's Pizza Hut faces increasing competition
RBD sales analysis
The dots get the hots
2007 FY profit analysis


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c Share Investor 2008

NZX Hangover from 1999 possible

Looking at charts for the beginning my Long vs Short series I got a bit sidetracked-but still related- as you can on the internet and found to my horror that the chart for the NZSX50 index for the last 10 years(above) looks like the kind of chart that would plot the course of the Hindenburg shortly before it crashed.

To be fair the New Zealand stockmarket pretty much reflects the sad performance of the Dow Jones index when you compare the 5 year chart (below) but when you look back a further 5 years that is when things look as ugly as Paris Hilton having it off with her shih tzu.

The NZSX50 is currently at early 2005 levels and only has 800 points further to fall to get back to 1999 levels. It has lost 750 points in the last 3 months, so it is not beyond the bounds that our index will be having a flashback hangover early 2009 inspired by New Years Eve 1999.

Time to resurrect Prince.






Related Links

NZX50
NZX 15
NZX 50 Portfolio
NZX SmallCap
NZX MidCap
NZX Blog

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c Share Investor 2008

Long vs Short: Mainfreight Ltd

In the first of a series of 17, I am going to take look at the chart comparisons for stocks from the Share Investor Portfolio when comparing the 10 year return (above) to the turmoil of the last year with a 1 year return chart (bottom of post).

In this series I want to show the merits of investing, using charts, for the long-term vs short term gains or losses. I will use the longest available data to me for the long-term view and will compare against the NZX50.

The first stock we will look at is Mainfreight Ltd [MFT.NZ] the global logistics company.

As one can see from the two large comparison charts if you have been a Mainfreight stockholder for 10 years your return has been over 300%. A magnificent return by anyone's standards.

Conversely if you look at the one year chart and bought Mainfreight a year ago your return is negative 30%.

Symbol	Price	Value	Earned
MFT.NZ	$4.80	$15000	$-7218.75
You own 3125 [MFT.NZ] shares purchased at $7.11 [$22218.75]

I have held Mainfreight shares for 2 years and as you can see from the chart above my 2 year return is around negative 33%.

Clearly the long-term view is the winner here and I would contend that if I hold for another 8 years the opportunity to gain similar returns to the last ten remains only if I continue to remain a shareholder.

I will also guess at this point that the next 16 posts in this series will show a similar story.

Keep checking back to see if my hunch is wrong!




Related Share Investor Reading

Why did you buy that stock? [Mainfreight Ltd]
Mainfreight 2008 Annual report worth reading
KiwiRail will cost Mainfreight
Mainfreight keeps on truckin
A rare breed
Share Investor's 2008 stock picks


Shareinvestorforum.com- Discuss this Share Investor Post



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c Share Investor 2008

Share Investor now at Findata

The guy in charge of content at Findata asked me to contribute some pieces for that site and so you can now find teasers of blogs from the Share Investor Blog if you are already a member of that site.

No money has passed under the table-mores the pity-so I am still going to be my occasionally objectionable self and "criticise" those individuals that don't pass financial muster.

The "community" part of the site is new but I have been using the data, news and analysis part of Findata for nearly a year.

Go take a look and if you like what I have to say ask the cheapskates there if they can pay me for my occasional gems of wisdom.

While I am here I highly recommend a blog called Trading Goddess It is irreverent, insightful, sexy and on the ball-give it a go why don't ya!


Related Links

Share Investor @ Findata
Findata
Trading Goddess Blog


c Share Investor 2008