RBD - Restaurant Brands

[Zito]

Appreciate the analysis Snoopy, reasoned as always and right on the mark from where I'm sitting.

Like you I am overweight in RBD pretty much for the same reason that you are. I have looked around the NZX for a company which is cheaper, with a greater potential to surprise on the upside, and with a better risk profile, and have come up short.

Unlike you I am a recent addition to the share register (this year) but become increasingly confident that it is a good place to park my money for as long as the current direction is maintained.

All three brands have had their challenges over recent years, and I wonder whether investors are a bit gun-shy of RBD given its history of providing unexpected nasty surprises to the market ( for want of a better expression!)
Maybe this could explain the apparently low multiple it is trading on, and given the bullish attitude of management and analysts towards KFC especially, a few more surprises to the upside may see a more deserving PE in time as the stock gains further credibility.

[Snoopy]

Unlike you I am a recent addition to the share register (this year) but become increasingly confident that it is a good place to park my money for as long as the current direction is maintained.

All three brands have had their challenges over recent years, and I wonder whether investors are a bit gun-shy of RBD given its history of providing unexpected nasty surprises to the market (for want of a better expression!)
Maybe this could explain the apparently low multiple it is trading on, and given the bullish attitude of management and analysts towards KFC especially, a few more surprises to the upside may see a more deserving PE in time as the stock gains further credibility.

Welcome aboard the share register Zito. I think the current direction will be maintained until the KFC transformation process is complete, which might take 8 - 10 years. The problem is the NZ market is only so big and we all know what happened when RBD sought to export their pizza expertise (sic) to Victoria!

Once the KFC revamp is bedded down, I will then start to get worried over what hair brained direction the company will take off in next! At least at the moment the board and senior management have plenty to do -thank goodness. It is when board and management start to get itchy and look for other ways to express their err -talents?- that we shareholders should start to worry again.

Because of the constraints of those NZ borders, I think that when KFC is brought back to its revamped 'normal sales level' then the company should trade on a PE of about 10. A PE of 10 is appropriate for a company with modest growth potential I think. I take your comment Zito, about looking around for better value on the NZX and not finding anything. But I am wary that this might mean the PE of the rest of the market might move back towards around 10, rather than the alternative scenario of the PE of RBD being revised upwards to market norms.

I am sure you are right again Zito that there remains plenty of market 'baggage' associated with RBD that is going to be hard to shake. But over recent years they have a new CEO, a new chair on the board and are getting rid of their troublesome assets. How much change do they need to show? I suspect that by the time the sharebuying public wake up to RBD, the full recovery potential will already be built into the share price.

SNOOPY

[Scuffer]

More stores will open as time goes on the population of NZ is increasing at a fair rate for a small country.

[emearg]

More stores will open as time goes on the population of NZ is increasing at a fair rate for a small country.

And a certain ethnic group who tend to like KFC very much, tend to have more children than some other ethnic groups. So given time, the portion of the population who likes KFC will increase. For long term holders of RBD shares that isn't a bad thing...

[BRICKS]

And a certain ethnic group who tend to like KFC very much, tend to have more children than some other ethnic groups. So given time, the portion of the population who likes KFC will increase. For long term holders of RBD shares that isn't a bad thing...

Could you please explain your comment have only noted mixed ethnic groups at my STORE..

[emearg]

Could you please explain your comment have only noted mixed ethnic groups at my STORE..

There is no doubt that a broad range of ethnic groups go to KFC, and I see no reason why that won't continue

My comment is about future population growth and how some of the fastest growing groups like KFC.

If in doubt look at New Zealand's population projections and/or talk to Restaurant Brands about their most popular KFC stores.

My comment is based on information that was made available informally at an AGM several years ago. It is interesting what you can learn in a chat over a cup of Starbucks coffee and a slice of Pizza.

[BRICKS]

There is no doubt that a broad range of ethnic groups go to KFC, and I see no reason why that won't continue

My comment is about future population growth and how some of the fastest growing groups like KFC.

If in doubt look at New Zealand's population projections and/or talk to Restaurant Brands about their most popular KFC stores.

My comment is based on information that was made available informally at an AGM several years ago. It is interesting what you can learn in a chat over a cup of Starbucks coffee and a slice of Pizza.

SO its not fact at all just your cosy CHAT..