I just read through this thread. I bought into this stock...

I just read through this thread.

I bought into this stock yesterday at $50.24. Time will tell if this will be a good investment or not.
The reason I like this company is they are a franchisor, with a very strong brand, and have a history of rolling out new stores which results in them continually making higher profits with a fantastic record of growth. I would not invest in the franchisees i.e. the actual pizza shops. Being franchisor, they continually get a cut of all sales at the franchisees. If they can continue to roll out more stores in Australia and abroad, their profits will continue to grow. There has been some problems this year with franchisees not doing the right thing by their workers, which has done some damage to the brand, and may result in franchisees making less profit moving forwards, but I am not sure that this will have a material impact on the franchisor i.e. DMP. It will become a problem for them if in fact franchisees cannot make a reasonable profit, and then in turn they all want to sell their businesses. I am not sure that there is any evidence of this occurring yet. I also like Retail Food Group, which has the same franchisor model, a large and diversified ownership strong brands, strong management and a proven track record. Unfortunately, RFG share price has also come under attack from shorting activity, which mainly seems to be coming from UBS and their clients. RFG share price has been recovering in recent times after positive announcements from management.

With the current share price of DMP, I am hoping that the share price will hold above $50, which may result in a double bottom reversal (DMP share price hit $51.20 on Friday 7 July) and this will hopefully signal a buying opportunity and share price increase moving forwards.

There seems like are quite a lot of chartists commenting on this thread. Whilst I have a little bit of knowledge of charting (and charting is worth taking into consideration), my preference is to rely on investing based on fundamentals i.e. historical profit, PE ratio, profit growth, dividends, debt ratios. I was taught at Uni that company share price should be valued based on net present value of future cash flows and I still believe this holds true. I was interested in someones comment in this thread that DMP PE ratio is 50 times, yet when I look on Commsec it says 37.77 times. Therefore, I will do my own analysis based on DMP annual reports for last say 3 years, and will share my analysis on this thread later on.

I am really not a fan of shorting activity. I struggle to understand why the ASX and other Regulators allow people that don't own the stock, to borrow the stock from other long term holders, with the view to sell (potentially manipulating the share price in the process e.g. UBS) and then buy back the stock at a later date. The long term share holders who lend their stock for a fee are moronic. It seems to me that this activity is another form of gambling and shouldn't be allowed. It's not allowed for property investing (would be impossible to implement I suspect), so why should it be allowed in the share market?