ROE and Net Margin are the steadily decreasing since 2012 which...

ROE and Net Margin are the steadily decreasing since 2012 which is possibly the contributor to their SP fall because it bodes towards increased competition in the sector post the entrance of discount supermarkets Aldi and Costco into Australia.

However, despite increasing competition, I still consider Woolworths to be a very strong business with competitive advantages stemming from its leading store network, low cost of doing business, and buying efficiencies given its leading market share. Expect these attributes to enable Woolworths to regain sales momentum and lost market share.

Also from a NZ POV, they are by far the fastest growing and most dominant franchise in NZ. The competitors here are weaker with minimal presence.

Gordon Cairns is also an excellent choice of chairman with the ability to lead a turnaround at Woolworths. He brings in extensive board experience and a good track record, including in the retail and consumer goods sectors. With a new chairman in place, the process of finding a new CEO is likely to be expedited.

I value WOW at $30+ but would hold off buying until the global macro factors are sorted out due to my risk appetite but in the larger scheme of things, WOW is very much a buy for me in the $24-$27 range.

Please DYOR before buying.

Thanks