Marston's Share Discussion Threads

[tim 3] 05/9/2018 09:35

Sold this morning and put into mrch as think it could fair better if things get ugly and risk is more spread in an investment trust.

Good luck all.

[ianood] 05/9/2018 07:49

And in this case the debt is effectively a long dated, fixed rate mortgage on the estate.

[quady] 04/9/2018 22:37

essentialinvestor - surely debt/EBITDA is only relevant if that debt can be called in.

What is EBITDA for MARS anyway?

[essentialinvestor] 04/9/2018 20:13

Careful, look at financial leverage then (net debt/EBITDA).

[spacecake] 04/9/2018 19:52

Hardly "specialist knowledge"



Burton union brewing method - 1830, One beer on the UK market uses this method of production, Marston's Pedigree. Burton Union Oak Barrels is the claim on the bottle front.[8][9][10]

[careful] 04/9/2018 19:11

Debt to market cap ratio need interpreting.
Market cap is seriously depressed at present.
Debt to market cap of utilities is often scary.
and look at the buy to let fanatics if you want scary debt to net asset ratios.
Gearing could be lower but is ok if the money has been well spent.

What matters is cash flow, profit, prospects, turnover.

If the business is sound the debt is manageable.

[careful] 04/9/2018 18:58

Gearing figures look ok.
PE multiples do include debt effects.
The interest charge reduces profit.

But then the freehold assets result in less rent outgoings, hence increasing profit.
The old rent or buy argument raises its head yet again.

I like to see assets on a balance sheet, provided the debt can be worked down.
Maybe that is why reducing the dividend would be a good thing long term.

[essentialinvestor] 04/9/2018 18:43

Net debt is over twice the current market cap.
PE multiple takes no account of debt.

In fairness they also own a substantial amount of property,

[quady] 04/9/2018 18:34

Essentialinvestor - why is P/E next to useless for Mars?

[the deacon] 04/9/2018 17:02

Speculation from the Citi Analysts....

[careful] 04/9/2018 16:06

Spacecake; are you familiar with their equipment?
Do share with us your knowledge.
Is the value to Marston that is important or the break up value?
presumably it still produces beer.

you hint at specialist knowledge.

[spacecake] 04/9/2018 15:59

Does Marston have any brewery equipment from the 21st century or are they from the 19th century, would they be worth anything to a modern brewer or better as a museum curio.
Thinking about those spining wooden barrels as fermenters.

[hopefuldave] 04/9/2018 15:47

Is the dividend drop just speculation based on what?

[careful] 04/9/2018 15:41

Agreed, debt is bad if the assets do not make a return.
ROCE ..return on capital employed used to be an important measure according to Buffett's guru, Benjamin Graham.

Debt is ok if they build a new modern premises in a great location and manage to make a decent return on its operation.
Debt vs ROCE.

that is capitalism, everyone these days assumes that the MARS investment is wasted.
(Apart from Amazon with a PE of 150+, virtually profitless.)
Then they assume it is 'ploughed back into the business'.

Strange times, I wonder how things will look in 5 years time.

[jeffian] 04/9/2018 15:41

I'm saying nothing!

[essentialinvestor] 04/9/2018 15:32

Careful, with respect PE on a stock like MARS is next to useless.

I'm sure Ian would say look at the net assets, where's I look at the net debt.

[cc2014] 04/9/2018 15:02

90p breached. I am surprised. Really surprised.

[careful] 04/9/2018 13:28

We never give the company the benefit of the doubt in these markets.
When a share price gets crushed, such as this one, we assume the market knows something.
it scares buyers away.

Sometimes the worst comes true, but over the years some of my best investments have been in out of favour companies such as this one.
It takes a leap of faith to trust that the management are adopting right strategy after being in the industry for years, and showing financial discipline when trade is difficult.
Who am I to give them advice, and how would I like it if a rank outsider tried to instruct me in areas I have experience of?

More often than not the low share price is just a feature of trend following young traders who do not need to know what a company does, they could not care less.Theshape of the curve says it all.
I will hold and hope the next 2-3 years will turn out ok.

[careful] 04/9/2018 13:13

An historic yield of over 8% and a PE of 6 suggests that something must be wrong.
but the whole sector seems to be facing an existential crisis.

The last results were ok, there seems to be enough business activity for this business to prosper, providing it is well managed.

[janekane] 04/9/2018 13:09

80p share price and chicken veggi burgers on the way

[quepassa] 04/9/2018 12:52

when it hits 90p, stop losses will force the price down further.

market makers are trying to hold it above 90p but are facing a losing battle in my opinion.


all imo. dyor.
qp

[essentialinvestor] 04/9/2018 07:15

The balance sheet gets too little attention.

It's the balance sheet that explains the current valuation imv.

If you're the optimistic type, MARS may be of interest to someone else.
That's a highly speculative reason to buy.

[pherrom] 04/9/2018 06:40

'It appears that trend continued into August, with data compiled by Barclaycard showing that pub spending increased 11.9pc year-on-year and supermarket expenditure 5pc.'
The Telegraph.

[quady] 03/9/2018 18:56

Cheaper and cheaper :-)

[quepassa] 03/9/2018 18:48

Closing at just a ha'penny over 90p, this marks a new 1 year low and a new 5 year low for Marston's today.


Looks set to go sub 90p imminently.


ALL IMO. DYOR.
QP