13/03/2024 09:20

Metcash Ltd (MTS) $3.93

MTS held a well-attended investor day yesterday, which speaks to the increasing interest in the stock. Tuesday was company presentations, putting more meat on the bones of their strategy, while today will be site visits, probably less well attended! We’ve owned MTS in the Income Portfolio since 2020, and we think the business has improved over that time and should be trading on a higher multiple of a growing earnings stream.

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07/02/2024 09:25

Metcash (MTS) $3.58

MTS this week confirmed the acquisition of three additional businesses for ~$578m that we think complement their existing operations and are consistent with their strategy in food and hardware. The purchases are being funded by a combination of debt ($278m) & equity ($300m) issued at an 8% discount to the pre-deal market price ($3.35).

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05/02/2024 16:37

Metcash (MTS) $3.64

Shares remained in a trading halt today after Metcash confirmed that it has entered into binding agreements to acquire Superior Food with for up to $412.3m, Bianco Construction Supplies (82.2m) and Alpine Truss ($64m) in a ~$560m deal, that will be funded via a $300m institutional placement at $3.35 (8% discount) and a $25m share purchase plan (SPP) at the same level.

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02/02/2024 09:11

Metcash Ltd (MTS) $3.64

Yesterday, Metcash (MTS) confirmed its bid for Quadrant’s Superior Food Group, which supplies packaging and cleaning products to restaurants, cafes, etc. Although no official announcement has yet been made, the company is a long-standing target of MTS, with a likely purchase price of ~$500mn.

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15/12/2023 09:34

Metcash Ltd (MTS) $3.47

MTS fell -3.1 % on Thursday as the defensive Consumer Staples Sector underperformed the index, but in this case, all of the fall was the stock trading ex-dividend 11c fully franked – MTS is forecast to yield ~6.3% over the next 12-months. We discussed the MTS result last week, concluding that we had turned more neutral on the stock following its 1H24 result.

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06/12/2023 09:19

Metcash (MTS) $3.52

Metcash (MTS) has three main areas to their business: food, liquor and hardware, and this week’s 1H24 result showed some interesting trends we should be across, both in terms of our holding in Metcash and more broadly. Food and liquor were solid as inflationary pressures eased. Food inflation in the 1Q was running at 7.7%, which slowed to 5.3% in the 2Q.

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04/12/2023 16:44

Metcash (MTS) $3.59

MTS +1.13%: Out with 1H24 results this morning that were marginally above consensus at the group level driven by a better outcome in Food & Liquor, however, their hardware division was a negative surprise and is struggling to show growth outside of acquisitions.

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27/06/2023 09:27

Metcash Ltd (MTS) $3.76

MM covered MTS yesterday afternoon, we believe the solid result should help placate the market worries around customer retention after COVID lockdowns and the transition of cash-strapped shoppers to cheaper options such as ALDI. While scale is a very important buffer when times toughen, and for this reason, Woolworths (WOW) is the preferred play of many fund managers, we believe these scale benefits are more than captured in the price, with WOW trading on 26x FY24 earnings while Metcash languishes on just 12x.

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26/06/2023 16:49

Metcash (MTS) $3.76

MTS +4.74%: Full-year results out this morning were solid, and marginally ahead of consensus expectations. Underlying profit of $307.5 million was up 2.6% YoY and above Bloomberg consensus of $299.5 million.

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28/03/2023 09:19

Metcash Ltd (MTS) $3.88

MTS dominates throughout rural Australia while also performing strongly in the major cities with old habits dying slowly as many people have become used to the more convenient local stores such as IGA.

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