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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: E_K_S who wrote (41116)1/20/2011 11:35:56 PM
From: Spekulatius1 Recommendation  Respond to of 78516
 
re SVU, a 20X earnings multiple is too high for a supply chain Business. SVU supply chain business is not like FDX or UPS (both have a substantial moat with worldwide operations and high market share. SVU business is more like SYY, a food distribution business with a national footprint only, which trades at 8x EBITDA or a 14X PE after taxes. SVU food distribution business is much smaller and should probably carry a lower multiple, especially since it's tied together with SVU supermarket operations (which would be free to pursue other vendors in case of a spinoff). I don't think you will see a good multiple for that kind of an operation.



To: E_K_S who wrote (41116)1/21/2011 9:23:11 AM
From: Madharry  Respond to of 78516
 
thanks for the responses. I think im more in spek's camp as far as what i woud value the distribution pe at so I dont think its dirt cheap, and im not impressed with the business or management so its a pass for me.



To: E_K_S who wrote (41116)1/21/2011 9:36:56 AM
From: JakeStraw1 Recommendation  Read Replies (2) | Respond to of 78516
 
SVU - Zacks Report
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