HLG - Hallenstein Glasson

[Beagle]

The best growth and highest percentage of goods sold online (15%) of any retailer in N.Z. including the master Rod Duke at Briscoes ! (No small feat to beat his abilities) !

In my view for where the 10 year Govt stock rate (risk free rate) is now, a no growth company should be on a PE of 11.
HLG is trading at a PE premium of just 1 to a fair risk free adjusted no growth rate company and yet their eps growth rate has been 15% per annum average for the last 5 years. Their stock turn is exceptional too at more than 4, more than once per season which is incredible for an apparel retailer !

Their PEG rate is 12/15 = 0.8. Some other company I posted a PEG rate of well under one the other day is now in play for a takeover. I really hope that doesn't happen to HLG as I am genuinely excited for the growth prospects of Glassons in Australia. Winner reckons the market there is six times the size of ours and fast growing Glassons sales there are still a little less than N.Z.

Fast growing retailers can have much higher PE's. A good example is "Canada Goose" on a forward PE of 30 !

HLG not in their league by any means but I do think if they can continue to prove their growth rate in Australia the market might accord HLG a slightly higher multiple.

[percy]

If you are keen on retailers do not forget LOV on ASX.Best retail business model I have ever seen.
I very much doubt Tim Glasson will sell while his son is doing such a great job running Glassons in Australia.

[Beagle]

One of KW's favourite's eh and I know she's done very well out of it in the past
Historic PE now 33 and has broken down through its 100 day moving average and looks to be in a fresh downtrend. Thanks for the reminder but I think I'll pass.
Tim Glasson should be very proud of his son, he's doing very well.

Just a reminder that this pending change makes life a bit easier for N.Z. retailers https://www.msn.com/en-nz/money/news...cid=spartandhp

[BlackPeter]

The best growth and highest percentage of goods sold online (15%) of any retailer in N.Z. including the master Rod Duke at Briscoes ! (No small feat to beat his abilities).
In my view for where the 10 year Govt stock rate (risk free rate) is now, a no growth company should be on a PE of 11.
HLG is trading at a PE premium of just 1 to a fair risk free adjusted no growth rate company and yet their eps growth rate has been 15% per annum average for the last 5 years.
Their stock turn is exceptional too at more than 4, more than once per season which is incredible for an apparel retailer !

Their PEG rate is 12/15 = 0.8. Some other company I posted a PEG rate of well under one the other day is now in play for a takeover. Hope that doesn't happen to HLG.

Interesting which difference it makes for the growth rates whether you use a five year or six year timeframe ... but I leave that up to you to calculate ;

I base my assessment these days typically on (averaged out) 10 year CAGR's to make sure that individual particularly good or bad years don't distort the picture.

Based on that was HLG's earnings growth 3.8% per year. Not that exciting, isn't it? If I combine that with a (10 year) PE of 18.8 - hey people need to have a lot of trust into increasing future growth rates.

But again - I think it just depends whether you see HLG as a more or less exciting cyclical - or whether you think their growth will be exponential and outgrow the climate hockey stick ;.

While we all remember a number of retail outlets in the past showing amazing growth rates for a handful of years, I can't really name one which did this over a longer period of time. Can you?

[couta1]

Had a chat with the Beagle and we just talked ourselves into buying more of these beauties.

[Beagle]

BP - This is the method I use and it works well for me so I am sticking with it.
Best guide to the future performance of a company in this order is:-
1. The most recent past
2. Extrapolation of the trend of financial performance over the last 5 years
3. What the company says about its outlook.

Going back further than five years, (when the business model, trading conditions, management and directors could have been very different) and somehow trying to argue this history is just as valid as far more recent history runs the real risk of watering down more valuable more recent information and in my opinion is more than likely to be unhelpful. Yes its more conservative but that's not necessarily helpful.

For me the underlying value is clear and the opportunity for significant future growth in Australia with Glassons is also crystal clear so as Couta1 has said, I have also added more today. I guess it comes down to whether you believe the opportunity in Australia is big or not. I'm definitely a believer.

[RTM]

BP - This is the method I use and it works well for me so I am sticking with it.
Best guide to the future performance of a company in this order is:-
1. The most recent past
2. Extrapolation of the trend of financial performance over the last 5 years
3. What the company says about its outlook.

Going back further than five years, (when the business model, trading conditions, management and directors could have been very different) and somehow trying to argue this history is just as valid as far more recent history runs the real risk of watering down more valuable more recent information and in my opinion is more than likely to be unhelpful. Yes its more conservative but that's not necessarily helpful.

For me the underlying value is clear and the opportunity for significant future growth in Australia with Glassons is also crystal clear so as Couta1 has said, I have also added more today. I guess it comes down to whether you believe the opportunity in Australia is big or not. I'm definitely a believer.

Hope you're not going beyond a very prudent % of your portfolio Beagle. Warehouse, Kathmandu, Michael Hill....

[Beagle]

Disciplined dog as usual...

[percy]

Enjoyed the joke.!...lol.

[Beagle]

Disciplined every day by Mrs Beagle lol