Thoughts on Woolworth’s & Costa Group (CGC)

Something to wonder about – WOW sold petrol interests and are making mini stores for their products at the servo’s. Now the sale of hotels, which I do not think is all about getting out of pokies and the image, they make MONEY.
They have an interest with Marley Spoon and maybe this is the new track they may be interested in. Just pondering, your thoughts?

My question:

Costa have been going through hard times with the drought and fruit flies. As one day it will rain and spraying will help with flies.
The shares appear down at the moment and were not mentioned by Peter for 20 shares that may recover over the next year or so.

Your thoughts please.

A: See last Monday’s Switzer Report below for my thoughts on Woolworths.


In regards to Costa Group (CGC), I am a little wary. I like the company, but maybe the recent earnings downgrade highlights the variability and challenges in agriculture – and suggests the company can’t command such a multiple. Even after the share price plummet, it is still trading on a multiple of 22.2x FY19 earnings and 18.5x FY20 earnings. Fruit flies impacting Australian citrus, crumbly raspberries, unseasonably warm weather leading to poor customer demand for mushrooms and issues with Moroccan blueberries were cited as reasons for the earning downgrade.


The brokers are marginally positive, but also wary. 4 buys, 1 neutral and 1 sell recommendation, and a consensus target price of $4.66, some 9.4% higher than today’s closing price of $4.28.

Read Answer