Coles (COL) hits new all-time highs
Stock
Coles (COL) $13.48 as at 18/06/2019
Event
The supermarket name is trading at all-time highs this morning, set to snap a three session losing streak with the market digesting the first investor day for the new standalone company.
CEO Steve Cain has unveiled a number of new plans that aim to increase profitability and growth to Coles which has lagged behind rival Woolworths (WOW) in recent years.
Convenience will be a key part of Coles’ new strategy and is now looking at introducing meal kit style options. The company also recently partnered with UberEats to increase delivery flexibility and in the midst of developing its online store with UK based Ocado. Data targeting is also front and centre for Coles as it looks to take advantage of the huge data pool that is FlyBuys.
While all this is happening, Coles is spending $700-$800m to build out 2 distribution centres while they also look to cut $1bn worth of costs out of the business by FY23, largely through automation.
The company noted 4th quarter sales had been reasonable, coming in between the 2nd quarters 1.8% and the 3rds 2.1%. Coles is looking to match revenue growth to market growth which is estimated to be around 3% each year, while maintaining a payout ratio of 80-90%.
Coles (COL) Chart
Market Matters Take/Outlook
