In response to your post I will highlight one company "Dick Smith".
When it was sold by WOW I was just out of WOW and was privy to the sales and margins, WOW made teh right call selling it.
Then DS trades for a while, I look at the business and nothing much has changed. DS is then listed and the value is set way above the price that WOW sold it for, the analysts say rah rah and people/Insto's/Banks pile in.
Fundamentally at no time was DS worth the listing value,It was perceived to be an old brand in a market that was increasingly losing margin. It had great competition and a disruptive move away from bricks and mortar to online meaning the competition was global.
Yep the SP went up, down, up then terminally down, why......cause it had fundamental problems that were not addressed.
So when I see WOW SP going up just because they have sold some bits and pieces and then look at the fundamental business model I ask one question, where is the revenue growth going to come from to justify such a rise? Yep no more throwing capital at Masters/petrol/ other bits and pieces.....but will that capital if invested in Supermarkets provide a return in increased revenue.....I don't think so.
Contrary to popular belief, the market that WOW plays in is no longer just a 2 horse race, as such refreshing stores etc just won't achieve the increase in sales anymore to justify the capital.
WOW must concentrate on its customers and change the perception out there or it is toast.
p.s. I think there is money to be made in teh short term, but this is not a long term share anymore
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