WOW delivered a solid result in August, cementing it as the highest quality Consumer Staple stock on the market, although it’s still being priced accordingly, i.e. WOW is trading on a valuation of 22.7x compared to Coles (COL) on 20x; however, the premium has slipped from closer to 15% earlier in the year. The stock has fallen -15% from its 2023 high, and we see no reason to catch the falling knife at this stage, but we will become very interested if it were to trade into the $30-31 region, another 10% lower.
- We continue to like WOW, valuation has been our concern through 2023, but it would be interesting below its 2022 swing low.
MM is neutral to cautiously bullish towards WOW below $32
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