Stock of the Day: The Warehouse Group Ltd

The Warehouse Group Ltd [WHS.NZX] share price has been hammered over the last 6 weeks. From a high of nearly $4.05 back in late November closing down today on low volume at $3.52.

The stock has been a victim of constant media attention on Christmas shopping figures and official retail sales releases over the last few weeks. Pumpkin Patch Group Ltd [PPL.NZX], Hallenstein Glasson Holdings Ltd [HLG.NZX] and other retailers have been similarly affected.

To be sure the WHS Christmas shopping fortunes for the first half of the 2011 financial year are very important to the bottomline but there is only anecdotal news at the moment that they are being hit hard.

For the share price to be hit by around 12% in six weeks seems a little overdone and I will be watching for further weakness for an opportunity to buy more shares for as little as possible.


Disclosure: I own WHS shares in the Share Investor Portfolio

The Warehouse Group @ Share Investor

The Warehouse Group Ltd: Takeover Prospect looking good on paper
VIDEO: Extended Ian Morrice Interview
Share Investor Q & A: Warehouse Group CEO Ian Morrice

Warehouse Group Ltd: 2010 Full Year Profit Analysis
Share Investor Q & A: Questions to The Warehouse' Ian Morrice
Long Term View: The Warehouse Group Ltd
Share Investor Short: Warehouse Group yield worth a look
The Warehouse Group: 2010 Interim Profit Review
The Warehouse: Big Brands, Big Opportunities
Warehouse strike opportunity to buy
Long Term Play: The Warehouse Group
Share Investor Short: Warehouse Group yield worth a second look
Woolworths supermarket consolidation an indicator of a move on the Warehouse?
Stock of the Week: The Warehouse Group
Warehouse 2009 interim profit a key economic indicator
When will The Warehouse bidders make their move?
Long vs Short: The Warehouse Group
Warehouse bidders ready to lay money down
The Warehouse set to cut lose "extra" impediment
The Warehouse sale could hinge on "Extra" decision
The case for The Warehouse without a buyer
Foodstuffs take their foot off the gas
Woolworths seek leave to appeal to Supreme Court
Warehouse appeal decision imminent
Warehouse decision a loser for all
Warehouse Court of appeal decision in Commerce Commission's favour
MARKETWATCH: The Warehouse
The Warehouse takeover saga continues
Why did you buy that stock? [The Warehouse]
History of Warehouse takeover players suggest a long winding road
Court of Appeal delays Warehouse bid
The Warehouse set for turbulent 2008
The Warehouse Court of Appeal case lay in "Extras" hands
WHS Court of Appeal case could be dismissed next week
Commerce Commission impacts on the Warehouse bottom line
The Warehouse in play
Outcomes of Commerce Commission decision
The fight for control begins soon

Discuss WHS @ Share Investor Forum - Register free
Download WHS company reports

Shop online at The Warehouse


New From Fishpond



A Perfect Gentleman: The Sir Wilson Whineray Story



c Share Investor 2010

Merry Christmas and Happy New Year from Share Investor

I have the 2011 Share Investor Stock Picks coming up over the next few days (my 4th one!) and that post is likely to be one of the last for 2010.

I wish all my loyal readers and to your families and loved ones a very Happy Christmas and a prosperous 2011 New Year.

It has been a pleasure writing on some my favourite subjects and I hope you have found some interesting tidbits to help you out in these very crazy financial times.

I hope you can all join me in 2011 where we can all do it again but this time with a smile and a wink!

To check out the holiday operating hours of the NZX and what is coming up please go here.

To those readers outside New Zealand the photo is of a Pohutakawa Tree, a Native coastal tree, the New Zealand "Christmas Tree".

Darren, Share Investor.


Share Investor's Annual Stock Picks

Share Investor's 2011 Stock Picks - NEW
Share Investor's 2010 Stock Picks
Share Investor's 2009 Stock Picks
Share Investor's 2008 stock picks


Essential Holiday Reading From Amazon


The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition) by Benjamin Graham
Buy new: $14.95 / Used from: $9.73
Usually ships in 24 hours


Security Analysis: The Classic 1934 Edition by GRAHAM
Buy new: $37.80 / Used from: $29.48
Usually ships in 24 hours

Buy these two Books @ Fishpond.co.nz




c Share Investor 2010 & 2011

Stock of the Week: Reprise 2: New Zealand Refining Ltd

With low refining rates, massive capital expenditure and plant shutdowns largely behind them and a rising global oil prices, 2011 looks to be a resurgent year for New Zealand Refining Ltd [NZR.NZX].

Back in October NZR was a Stock of the Week because its share price was 30c below what it closed at yesterday and I commented that higher oil prices will see this stock rise (well duh) and it has but the oil price rise has been a significant one. It has been mainly due to a very cold Northern Winter bumping up all sort of petrochemical products so it is unclear just how sustainable the oil price rise will be. Having said that the recent rise is bound to gain some traction even when the Northern ice melts away.

NZR is also subject to the NZ dollar US dollar cross but it looks like the Kiwi has finally started its appropriate ride down (ironically partly due to higher oil prices) to a value that reflects the dire outlook for our economy over the next 3-5 years.

These positive impacts for NZR seem to be conspiring all at the same time and should have a big impact on the fortunes of the company for 2011.

Historically the closing price of $3.91 yesterday is relatively low but you might want to put this on your watchlist if you are thinking of buying NZR and buy on any overall market weakness.

NZR @ Share Investor

Stock of the Week - Reprise: NZ Refining Ltd
Chart of the Week: New Zealand Refining Ltd
Stock of the Week: NZ Refining Ltd

Discuss NZR @ Share Investor Forum
Download NZR Company Reports


Stock of the Week Series

Pumpkin Patch Ltd
Fisher & Paykel Healthcare Ltd
Sky City Entertainment Group Ltd
Reprise 5: Contact Energy Ltd
Reprise 4: Contact Energy Ltd
Reprise 3: Contact Energy Ltd
Delegats Group Ltd
Reprise 2 : Contact Energy Ltd
Reprise: Contact Energy Ltd
Restaurant Brands
NZ Refining
Ryman Healthcare
Mainfreight Ltd
Fisher & Paykel Healthcare
Xero Ltd
Auckland International Airport
Sky City Entertainment Group
Burger Fuel Worldwide
Michael Hill International
Contact Energy Ltd
The Warehouse Group
Fisher & Paykel Appliances
Reprise: NZ Refining Ltd


Recommended Fishpond Reading



Buy The Intelligent Investor & more @ Fishpond.co.nz




c Share Investor 2010

Burger Fuel Worldwide: Losses Mount

Burger Fuel Worldwide Ltd [BFW.NZX] has just racked up its 7th consecutive half year loss to 30 Sept 2010 since listing in mid 2007.

Typical of management, the company is highlighting sales revenue from franchised stores, which has risen sharply due to store openings in the Middle East and downplaying the franchise income - which is what the company will eventually make a profit on - which has increased by a small fraction.

Key Points

Loss of $219,000 down 26% on lasts half's $296,000

Flagship Kings Cross store closed

Middle East stores performing well.

Australasia stores flat

Set to exit remaining Sydney store.

$1,153,153 cash left in bank

Profit possibly set for 2012 - 2013

The $219,022 loss is a 26% improvement on last years comparable figure so at least this is improving but the company is struggling in New Zealand and has largely abandoned its Australian operations which were a big focus of growth when they announced their IPO. Their Flagship store in Kings Cross has been closed to save money.

The focus from 2010 onwards is growing in the Middle East. Well done to change tack so quickly but the homework just hadn't been well done before a couple of million dollars of shareholder money was lost in Australia.

Shareholders will have to question as to whether the Middle East is going to be any different from the Australian experience but thus far it is looking a little more promising than our more competitive and more business savvy cousins across the Tasman.

Management have focused the 2010 calendar year on pruning business costs and have managed to save $68,000 in the last half year .

Significantly management have changed their expansion model so will grow by means of Area Development or Master License Agreements. This is where the licensee is responsible for all capital and operational costs. This will clearly allow the company to grow quicker and cheaper where it sees the opportunity.

Management indicate they see limited scope for expansion in Australasia and see a patchy and uncertain 2011 ahead.

There is no indication as to when the company will make its maiden profit but management indicated that "the company expects to reach profitability in the near future".

It looks to me that 2012 - 2013 could be that near future.


Burger Fuel Worldwide @ Share Investor

Burgerfuel: Dubai Marketing Hype!!!
Burger Fuel 2010 Full Year Profit Analysis
Burger Fuel 2010 Full Year Profit Preview
Burger Fuel Worldwide: 2009 Half Year profit analysis
Stock of the Week: Burger Fuel Worldwide
Download full company analysis from Thomson First-Call
Burger Fuel doesn't rule out capital raising
Burger Fuel Worldwide: Closer look at Company Accounts
Analysis - Burger Fuel Worldwide: FY profit to 31/03/09
Burger Fuel: Running on Empty
Burger Fuel leaves investors hungry
Burger Fuel management cagey over company progress
Burger Fuel cooks up Dubai deal
NZX share trades with strings attached
Don't buy Burger Fuel, yet
Burger Fuel: Inside info?
Burger Fool IPO: Burger Fool?
Exclusive Interview with Burger Fuel's Josef Roberts
Burger Fuel's Daytime drama
Burger Fuel share price out of gas
Beefing up store numbers
Director explains share price drop
Burger Fuel slims down in value
Burger Fuel and Coke
Marketing Burger Fuel's future
Pumpkin Patch VS Burger Fuel
Burger Fuel results and commentary

Discuss BFW @ Share Investor Forum - Register free
Download BFW Company Reports


From Fishpond.co.nz



Buy Every Bastard Says No - The 42 Below Story, by Geoff Ross & Justine Troy & more @ Fishpond.co.nz




c Share Investor 2010