Pizzas & Donuts for thought...., page-100

RFG has had a lot of bad press and been fighting lawsuits over the last 3-4 years, COVID has had huge impacts on the restaurants sector. Both of these combined are going to impact on RFG share price. Disposable income has no relevance to employment numbers. Employment numbers just tell you there are more people employed. Cost of living is increasing but interestingly not at the same pace as household income which means people actually have more money to spend. Also need to account for global uncertainty and the impacts this and other factors have on peoples perceptions and freedom to spend (home prices in Australia are high on average compared with other global economies and rents are increasing, there are fewer rentals available so people who rent will naturally retain more money to find a suitable home).

Basically what I am saying is that we aren't out of the woods yet where people feel they can readily spend but there are many more people heading out now to shops, shopping centers and restaurants so the situation is definitely improving. I do see RFG bouncing back and am expecting to see improved financial performance reported in the next updates.

I do feel from looking at my local Michels, whose sign for the coffee area is missing the "e" that the store looks dated and the product line remains coffee, cakes and some pastries. I feel they need to reinvigorate the brand a bit and maybe add in a smoothies, tea drinks, frappes, frappuccinos, matcha lattes or something. Places like Starbucks and McDonalds constantly update and introduce new things. I haven't seen anything new added into Michels for ages.

I've changed my sentiment back to a buy. Whilst the share price may go a bit lower I don't think it will drop below 4c and the trajectory should be up given I am seeing more people out and about, more people in shopping centres, more people buying take away etc. This can and will only translate into more sales.