Buy Hold Sell: From darlings to dogs

Buy Hold Sell

Livewire Markets

We all love a good hotdog, but less so when the meat is on the turn. So in this special episode, our expert panelists give two former fast-food favourites the ‘sniff test’. Join us as Roger Montgomery from Montgomery Investment Management and Karl Siegling from Cadence Capital talk with Sam Willis from BTIG about their views on Retail Food Group and Domino’s Pizza, both of which have given investors severe indigestion over the last 12 months. Tune in to hear why drones dropping pizza in your mouth may not worth a PE of 65 times, and to hear a story of Roger’s bid to become a Domino’s franchisee, in this latest exclusive from Livewire. 


Key points: 

Retail Food Group (RFG): 

Once a market darling, it has fallen over 85% since early 2017. We ask whether it is time to venture out there? Or is it a case of ‘buy when assets are going up, and sell when assets are going down’ as Karl says. The stock may have grown its profits four fold over the years, but grow its equity even faster. The stock looks distressed, and could further contraction be on the cards? 

Domino’s (DMP): 

Is Domino’s any different? Possibly not. Roger tells a story that suggests that their franchise model is not sustainable over the long run. Cadence has been short the stock, and even after falling from $70 to $45, Karl thinks the valuation is still high and suggests the share price is only half-way through its journey south. 


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Buy Hold Sell

Buy Hold Sell is a weekly video series exclusive to Livewire. In each episode two fund managers give their views 'Buy, Hold or Sell' on five ASX listed companies. Not recommendations, please read the disclaimer and seek advice where appropriate.

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