BGR - Briscoes Valuation

[see weed]

Who does your tax return.?

did you get my pm?

[see weed]

Sussed why you shortchanged on divie yet

Will find out on Tuesday due to Easter, will let you know.

[simplesimplesimple]

Briscoes seems fairly priced now, to my inexperienced eye and calculator - nothing like a 30% margin of safety, though.

The Amazon risk does seem significant, as most of the Briscoes range is existing fare for Amazon. I use the Briscoes online system a bit, and they're pretty good, but the intense competition Duke always mentions in his shareholder reports would be at a different level with Amazon in the mix. I started thinking today that maybe the right way to look at it is from the Amazon end i.e. getting my head around whether the Amazon retail model really will prove sustainable - I know the recent profits suggest maybe, but that's in large part the AWS business propping up the retail. Maybe for Amazon to become profitable they'd have to be so dominant that they'd be broken up? Maybe investors will eventually think that paying top dollar for a business not making much money isn't a winning strategy (although to date that's not the way it's been seen!)

I think it's a Keynes quote that markets can remain irrational longer than an investor can remain solvent - maybe the parallel is that Amazon can keep destroying retail businesses for a long while yet even if the model doesn't prove to be successful, ultimately.

[JeremyALD]

Yeah I think BGR is a good stock but I can't see much more growth in the next five years - maybe 5% p.a. max unless they do something different.

[simplesimplesimple]

Yeah I think BGR is a good stock but I can't see much more growth in the next five years - maybe 5% p.a. max unless they do something different.

It's a good dividend stock, and I like what I know of Duke, but the possibility of being crushed by Amazon makes me nervous. Not sure what price I'd have to see to feel it was a justified risk of capital. Without Amazon I think I'd start buying slowly now for the income stream.

[dragonz]

Amazon will be of little threat unless they decide to start warehousing items here and then they face all the costs and regulations the local retailers do.

[minimoke]

BRG now under the spotlight like Smith City group for not paying workers for non-sales work like the rark 'em up motivation meetings and store close ups

[Jay]

I would have thought that outfits such as Briscoes etc would have the hours of work starting before the shop opens and after it closed such as 8:45 to 5:15 for a 9-5 opening time for example.
In any "retail" outlet you cannot just down tools so to speak and leave at 5pm. need to cash up each day and get it out in the morning as a minimum, doesn't happen instantly.

[Patient Panda]

This is my first post on this forum. I have been reading here religiously for at least 3 years and have tried to make an account several times but was always unable without access to an ISP email address. This is one reason I would suggest for the high viewership to poster number ratio.

Disc: 25% of my listed portfolio is comprised of BGP.

On to Briscoes.

i have noticed on this forum often times the true golden companies are unsung heroes.


I’m a huge fan of Briscoes and of Duke. Hes a value hound at heart, he didn’t chase KMD for a stupid price and they focus on doing the basics well instead of flashy inconsistent approaches I see all over the place.

Briscoes is without a doubt some of the best value you can find currently on the NZX.

Sitting currently on a P/ E ratio of 12.92

it has an average 5 year return on equity of 28%! (According to reuters data). This is enough to be making Buffet and Munger salivate. The large increases in EPS are not being diluted to laughable levels

The return on equity figure looks even more impressive considering they have low debt and are conservatively managed.

They pay a fantastic increasing dividend.

to the best of my knowledge over the past 10years its turned a profit 9 of those years. An enviable track record, even moreso in the retail industry and directly post GFC.


looking forward to discusing BGP with you all in more detail and depth.

[whome]

[QUOTE=Patient Panda;718582]This is my first post on this forum. I have been reading here religiously for at least 3 years and have tried to make an account several times but was always unable without access to an ISP email address. This is one reason I would suggest for the high viewership to poster number ratio.

Message to moderator. I Agree with PP. I know a number of share savvy people who would like to take part in this forum but simply gave up trying to get onto it. Frustrating.