From the 'lively' blog this morning:Supply Networks (ASX:...

From the 'lively' blog this morning:

Supply Networks (ASX: SNL)

Tom Piotrowski: Andrew, if Warren Buffett was in the room, I think Supply Networks would be probably his favourite stock on this list. Would it be a buy, a hold, or a sell for you?

Andrew Peros (BUY): Supply Network is a buy. And I do agree, it's a boring stock and probably something that Warren Buffett might be attracted to. But it really is benefiting from some of the structural tailwinds in that part supply to trucks and servicing of those trucks. They're increasing the number of SKUs, they're increasing their footprint, and they're taking share from some of the incumbent OEMs. It ticks a lot of boxes in terms of the stocks that we like. A fast-paced top line, a bottom line which is matching it in terms of growth rates, a high return on investor capital, and it's founder-led, so it's a buy

Tom Piotrowski: James, sometimes success can become boring and people become just a little bit blasé about it. But this is an organisation that has succeeded over generations, decades. Is it a buy, a hold, or a sell for you?

James Barker (HOLD): So Supply Networks is a hold for us at the moment. As Andrew said, we really think it's a high-quality business. There's a clear set of tailwinds in terms of the shift away from OEMs. They continue to take market share there. We just think that this is reasonably well factored into the current trading valuation. So a couple of years ago, management came out with a three-year target for $350 million of revenue. They've hit that a year early and they're expected to hit it this year. They've already come out with their next target for the next three years, but the market's got them getting there in two years. So we just think, on 37 times at the moment, it's delivering about high tens EPS growth. We just think it's reasonably well factored in and we'd love to see a period of consolidation before adding to this high-quality name.