BUZZ – Woolworths: Jefferies says Endeavour Drinks Group demerger 'sensible'
11 May 2021 09:43
- * Jefferies says its not a surprise that Australia's biggest supermarket chain Woolworths Group is pursuing a demerger of Endeavour Drinks Group (EDG), rather than a trade sale, considering tax implications
- * WOW on Monday said it would press ahead with the separation of its drinks and hospitality business, which was shelved last year due to the pandemic...
- * Brokerage says that separation is "sensible" given social concerns with gaming and ability to invest in hotels for growth
- * Adds that 70%-75% dividend payout ratio that EDG will operate with leaves c.$100m headroom which could be spent on bolt on acquisitions, additional growth capital expenditure or return to shareholders
- * PT remains unchanged at A$45.50, while brokerage retains "buy" rating
- * 10 of 13 analysts rate the stock "buy" or higher, two "hold" and one "sell" or lower; their median PT is A$44.0 –
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