Metcash (MTS)

Hi Tony,

Our positive view toward MTS is 3-fold;

1. They trade on a more palatable 12.5x PE 1 year forward, which has been historically warranted, but we think there is an identifiable path for MTS to trade on a higher multiple over time.
2. This should occur as the proportion of their business exposed to ‘growthier’ areas such as hardware, continues to increase, plus recent acquisitions give them more scale.
3. MTS yields a more attractive 6.5% fully franked, compensating us for our patience.
4. Not executing well on their strategy would prompt us to sell, or, when the share price finally appreciates to a point where the valuation is no longer appealing.

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Metcash Ltd (MTS)

LAST UPDATED 09/08/2024 10:40

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Metcash Ltd (MTS)

LAST UPDATED 09/08/2024 10:40