Woolworths Limited (WOW $25.45)
Recommendation: Accumulate
Risk Rating: Low
4th quarter 2008 Sales - Store Refurbishments Remain a Key Driver
WOW reported total sales of $47.0bn for 2008, up 10.7% on the prior
corresponding period on a statutory basis, and ahead of OML forecasts of 9.2%.
Refurbishments to the store format continue to deliver strong sales and margin
performance in Australian Food & Liquor and will be a driver of sustained earnings
growth for the company.
Australian Food & Liquor continues to perform strongly, despite the rate of like for
like sales growth moderating, and New Zealand Supermarkets disappointed with
weak sales. As a result, operating de-leverage is likely as supply chain and other
cost reduction programmes have yet to mature.
Following this sales release, we have reduced our 2009 and 2010 eanrings
forecasts by 2.3% and 3.0%, respectively, due to a reduction in the rate of sales
growth, and a moderation in earnings margins. We retain our 30 June 2009 share
price target of $32.40 per share.
We suggest the current WOW stock price represents an attractive entry point for an
investor and reiterate the following key qualities; sustainable sales growth, strong
rate of earnings growth, leading industry position, history of delivering, and
defensive earnings stream.
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Last
$33.81 |
Change
-0.120(0.35%) |
Mkt cap ! $41.30B |
Open | High | Low | Value | Volume |
$34.11 | $34.25 | $33.74 | $48.96M | 1.445M |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
1 | 280 | $33.77 |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
$33.84 | 6043 | 5 |
View Market Depth
No. | Vol. | Price($) |
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1 | 280 | 33.770 |
3 | 1028 | 33.700 |
2 | 674 | 33.690 |
1 | 960 | 33.660 |
1 | 1000 | 33.630 |
Price($) | Vol. | No. |
---|---|---|
33.840 | 6043 | 5 |
33.850 | 932 | 1 |
33.860 | 5369 | 1 |
33.870 | 10302 | 1 |
33.880 | 5369 | 1 |
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