Secondary Recommendation

McColl's Retail - Convenience store chain makes key acquisition

September 2017

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

The proposed take-over of Booker, owner of the Budgens, Londis and Happy Shopper convenience store chains, by Tesco for a handsome premium has thrown a spot light on this £37.5bn sector, which is forecast to grow 2.2% p.a. compound to 2020 as people make more frequent “top up” purchases in local stores versus single weekly or monthly “main shops.”Another neighbourhood convenience player, McColl’s, which listed on the market in 2014, initially had a miserable time with the shares bombing from 191p to a low of 136p in 2016 as presumably investors were scared off by the nasty price deflation sweeping across the food retailing industry. But buried in its prospectus was a promise to consolidate this f ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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