Coles shares have tumbled ~15% over the last couple of weeks following their half-year results, the headline result was ok but loss of market share and an uncertain short-term outlook has weighed on the share price. COL increased revenue 8% to $20.6bn flowing down to a 14.5% lift in profit to $560m but the outlook that the best is now behind it has been the cause of the decline. We believe the stocks 4.2% forecasted fully franked yield is going to become increasingly attractive into further weakness plus we feel further deterioration in supermarket performance is starting to be factored into the share price whereas an improvement is far from out of the question.
MM likes COL in the $14 to $15 region.
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