Why do I hold MTS shares? As a long term value/recovery play, I have averaged in at $1.37.
I have twice as much WES for growth, yield and stability.
I have done some research over the last few months, see below:
Pro's:
My wife shops at Coles mainly, then IGA for top-ups and "emergencies". She finds WOW more expensive (than Coles) so only buys a few things there.
We're in WA so no Aldi (yet) but I've been in to a few in Brisbane and the UK recently to check them out and am not particularly impressed, the clothes/appliances section looks tacky.
My wife's not impressed with Aldi's, limited range so would have to go to multiple shops which just takes to much time. Brands keep changing.... If you're a pensioner with time on your hands, then those are not obstacles though.
My UK work associate wouldn't be seen dead in one, "they're for poor people". He shops at Sainsburys and drives a Jag.
Most Aldi's I've seen are not in particularly convenient locations. But everyone agrees are cheaper. The Cannon Hill Brisbane Aldi had a fair amount of shoppers in it, but was lifeless, the adjacent Coles shopping centre was really buzzing.
IGA's in my part of WA are clean and well presented, recently renovated, compare well with WOW & Coles.
My mate runs a Thirsty Camel and says MTS is their main supplier and regards them highly, but IGA less so.
Another friend is a CA and owns a stationery distributor and says he buys a lot of office supplies (e.g. Coffee) from MTS and would buy even more if they were "more organised. They just don't seem hungry for orders". He rates them a recovery buy as "they'll sort themselves out".
Several people I know in Brisbane would prefer to shop at IGA to "support the independents if they were nearby, but usually they aren't".
One day the Euro zone will split up into strong and weak currency zones which will put a spanner in Aldi's weak Euro free ride (i.e. German chocolates being so cheap).
Simon Marais (Allan Gray) was a big buyer based on value and at much higher prices, and he was good. Pity he's passed away, I would feel better if it was him still buying at Allan Gray and not just one of his subbies. RIP.
Con's:
There's lots of Aldi and Lidl in UK and lots of Aldi in Brisbane.
They seem to know what they're doing, lots of subtle adverts (I.e. pseudo news stories that put them in a positive light, but don't come across as them doing the hard-sell).
My Brisbane Emirates limo driver liked Aldi, shopped mostly at Coles and WOW, and didn't trust IGA. He didn't know why he had a problem with IGA as he hadn't been in one for years. He said price was most important for him.
Summary
New management and a recovery strategy in place.
19% of shares have been shorted, one day there will be a bear squeeze.
Recent share price action has been promising.
Holding thumbs!
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