Similar to the below poster, I grabbed a small stake @ 3.47,...

Similar to the below poster, I grabbed a small stake @ 3.47, wanted to buy more, but held off thinking there's no rush given widespread bearish sentiment on retail.

Literally every retail analyst or fund manager I read were either saying there's more pain to come or that we're not at the bottom of the retail cycle yet. That was when HVN was at $3.20's or $3.30's. I'm hopeful it'll come back down again so I can pick up a meaningful stake.

Meanwhile I'm thinking, HVN has the majority of its stores in regional Australia where competition is less intense - in some cases they might be the only store around to buy furniture, whitegoods, etc from. Those stores have a guaranteed customer base.

Australia keeps growing, all these new migrants need to furnish their homes. They do not have the negative opinions of Gerry Harvey or the store that many Aussie millenials seem to have. They'll keep buying from Harvey Norman, which should be enough to offset the "boomer" customers dropping off over time.

Gerry himself is in his mid 80's. Look forward 10 years from now. You can see a situation where he's no longer associated with the chain and HVN becomes just another ASX200 company run by an independent board, with a handpicked CEO based on merit. Gerry has said he's not into business dynasties, so none of this Packers and Murdochs handing the down to their sons business. There's no reason then for most Gerry Harvey hating Australians to avoid HVN then, especially as they probably own HVN via their super or index fund. Those who are against buying at Harvey Norman on principle would be shooting themselves in the foot.

Another source of growth, long term: their overseas retailing business. Looking at trend lines, they've been growing in general over long periods. No reason to think that won't continue.

Other strengths: franchise model means you can get staff working for you for free. I was amazed to learn that each section in a Harvey Norman store has its own franchisee. So the sales staff you're talking to in the bedding section may actually be the "bedding franchise owner". As far as I know, HN owes these personnel no wages. Their payment is a share of profits their section makes. In a downturn, you could potentially have stores staffed exclusively by franchise owners who don't draw a wage at all from the company - a distinct advantage over JB Hifi, Myer, etc.

Summary: I think HVN can sustain a 10% earnings yield in the forseeable future due to strong migration levels, with potential to be earning much higher profits when Gerry Harvey isn't CEO anymore, and due to a larger international business. It's decent value at current levels.