Stock Watch - Stock Pick — Mediclinic and Woolworths
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Gerbrand Smit from NeFG Fund Management chose Mediclinic as his stock pick of the day and Chantal Marx from FNB Wealth & Investments chose Woolworths
Smit said:"I'm going with Mediclinic, they were at R220 a share but had some perfect storms with regulations issues in the Middle-East and Switzerland. They are also having some difficulty locally in the SA market. If you look at the latest set of numbers that they said they are going to deliver and you look at normalisation of those earnings you are sitting close to an 11 PE (Price Earnings) multiple at R61 a share where it is now, so to buy a quality hospital group, who's margins were under pressure - and you can actually expand it over time, I think just makes sense"
Marx said:"David Jones was a massive disappointment for them and they got it really wrong in ladies fashion in South Africa. They seem to have, anecdotally gotten the ladies fashion story right, their stores look a bit busier, their trading densities have improved and they are looking to recover off a low base in Australia. They are making fast work of paying down their debt and the stock trades at an extremely low multiple relative to its history."
Smit said:"I'm going with Mediclinic, they were at R220 a share but had some perfect storms with regulations issues in the Middle-East and Switzerland. They are also having some difficulty locally in the SA market. If you look at the latest set of numbers that they said they are going to deliver and you look at normalisation of those earnings you are sitting close to an 11 PE (Price Earnings) multiple at R61 a share where it is now, so to buy a quality hospital group, who's margins were under pressure - and you can actually expand it over time, I think just makes sense"
Marx said:"David Jones was a massive disappointment for them and they got it really wrong in ladies fashion in South Africa. They seem to have, anecdotally gotten the ladies fashion story right, their stores look a bit busier, their trading densities have improved and they are looking to recover off a low base in Australia. They are making fast work of paying down their debt and the stock trades at an extremely low multiple relative to its history."
