Alex Sweet

Sorry to hear, get well soon.

UK economy straws in the wind:

👚Primark UK LfL sales -6.4% in last 16 wks, while EU & US see strong growth

🤝Workspace lettings -12% as London SMEs give up & churn out

🥂Chapel Down sales -5%, English wine loses its sparkle

#ABF #WKP #CDGP

4imprint – contrarian compounder (FOUR.L, $2.0bn market cap, $2.7m ADVT)

ICYMI: my full 4imprint write-up from Feb'24 is at this link

sweetstocks.substack.com/p/4imprint-c...

4imprint 2024 PBT of $153m is bang in line with the $152.7m in my central scenario from a year ago

But the route to get there was a surprise - lower sales & higher margin vs my estimates

A return to good sales growth is much needed for 2025

#FOUR $FOUR.L

Fullers and Mitchells & Butlers both reported stonking double digit LfL growth for their festive seasons (5 / 3 weeks respectively)

Good to see Britons in a mood to celebrate, with an assist from Aslef

#FSTA #MAB

Loungers get a 4.8% bump to the cash offer from Fortress

Well done to the Loungers institutional shareholders who showed a minimum of backbone to extract the improved offer

I guess deal now likely to sail through

#LGRS

Grafton trading update is decent in the circs:

* LfL sales positive in Nov / Dec

* Bought back 17.9% of shares since mid 2022

* Entered Spain w/ HVAC distributor, though tough start after floods

11.5x 2025e P/E

$GFTU.L

ICYMI: my full write-up is free to read at the link below

sweetstocks.substack.com/p/goodwin-plc-…

Goodwin's £17.1m trading profit in H1 puts them on track towards the £49m for FY26E that I forecast in my detailed write up back in June

Core nuclear and naval parts are carrying them to date, with Easat radar, Duvelco polyimide and AVD extinguishers yet to kick in

#GDWN

FirstGroup re-enters the London bus market after an 11 year absence, buying RATP's ten depots

It turns out the French govt has been kindly subsidising TfL, taking big losses on its London bus contracts as it failed to account for driver wage inflation in jts bids. Merci!

#FGP

Domino's Pizza Group makes peace with its franchise partners. Includes £3-4m of 'direct incremental contribution' by #DOM in FY25, plus an extra £4-5m invested in cost base. Also £3m unmitigated budget impact

Adds up to c9-10% profit downgrade?

#DOM

Indeed, management took a confident tone in the call.

If they do deliver >£90m adj EBIT in H2'25, then it likely implies decent upgrades to FY26E, where consensus is at £182m prior to any changes.

Watches of Switzerland – time for the US (WOSG.LN, $1.2bn market cap, $2.6m ADVT, 96% free float)

PS I continue to hold it. ICYMI my write-up is at this link: sweetstocks.substack.com/p/watches-of...

Watches of Switzerland with a heroic reiteration of FY guidance. Now requires c£90m H2 EBIT after £66m in H1

For comparison, H2 last year was £62m

Plenty of big openings to support H2... but still a huge ask

#WOSG

Good point. I assume a global beverage co such as Coke that contributes across regions.

Treatt FY looks decent. 13% H2 rev growth was a miss due to a delayed shipment, but profit still ahead... setting up a good FY25?

16x P/E if can grow 10% in coming year

Top customer has jumped in size, not explained in commentary. Is it a brand owner or a distributor?

#TET

M3 – digital healthcare serial acquirer at 4.4% trailing FCF yield (2413.T, $6.8bn market cap, $58m ADVT, 60% free float)

New: M3 of Japan is a serial acquirer in digital healthcare. Its sites for doctors are monetised via drug marketing, recruitment, market research & SaaS products

Despite a stellar LT record, M3 is -86% from peak due to a Covid hangover

I'm a buyer

$2413.T
sweetstocks.substack.com/p/m3-digital...

Q for any merger-arbs.

Loungers bid agreed at 310p, due to close late in Q1'25

Alpine, Glazer, Green Ash are buying in now at 305p

What implied probabilities for a bump, vs a deal break and downside price, are required to make this attractive?

#LGRS

An innovative company. They're piloting a novel 'two-room' layout for pubs, with different rooms to suit different kinds of customers. Could it ever catch on?

Victrex outlook statement unpacked:

-volume growth potential MSD

-PBT growth ahead of volumes

-subject to £7-8m FX headwind

-board has strong confidence only in LT!

FY24 PBT £59m, so guiding ~flat after FX?

Consensus @ £74m will need to cut by double digits?

#VCT

Today's Sweet Stocks write-up is the $12bn mkt cap Shimano, one of Japan's few firms with a dominant >50% global market share

I hoped Shimano would be a buy, but I found a number of risk areas for slower growth ahead

Feedback welcome 🙏

$7309.T

Does anyone know how to make pictures rotate woth your screen in this place? Unlike on Twitter, in this place turning my phone horizontal doesn't make your exhibit display landscape, so it is illegibly small.