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Grafton group

  • 16-07-2008 12:11pm
    #1
    carrigdhoun
    Closed Accounts Posts: 1 ✭


    I bought 2.5K worth of Grafton shares back in Feb. at €5.40, which was half their 52wk high at the time. The shares are at €2.62 today and I am planning to buy another 3K's worth. I would be interested in board members views on Grafton. I feel the DIY section should be insulated somewhat from the downturn and even taking into account the trade sales slowdown, i feel the shares are cheap at this price? It seems to be a very well run company and has a good asset base with lot's of prime locations. Are these type of builders supply groups near the bottom of the cycle or is there more downside?


Comments

  • #2
    ixus
    Registered Users, Registered Users 2 Posts: 2,435 ✭✭✭ixus


    So you've lost 1.25K or 50% of your investment in less than 6 months on one company, yet you're willing to put another 3K into them?:eek:

    Tell me. When you invested last time, did you think the economy would be ok? Did you think the company's fundamentals were sound then?

    There are no positive signals in construction. When you start to see positive signals, that's the time to look at companies who rely on such to make a profit.

    I'm afraid you should be taking the view that the glass is half empty, not half full....


  • #3
    stepbar
    Closed Accounts Posts: 6,123 ✭✭✭stepbar


    carrigdhoun wrote: »
    I bought 2.5K worth of Grafton shares back in Feb. at €5.40, which was half their 52wk high at the time. The shares are at €2.62 today and I am planning to buy another 3K's worth. I would be interested in board members views on Grafton. I feel the DIY section should be insulated somewhat from the downturn and even taking into account the trade sales slowdown, i feel the shares are cheap at this price? It seems to be a very well run company and has a good asset base with lot's of prime locations. Are these type of builders supply groups near the bottom of the cycle or is there more downside?

    I would take a look at the Grafton website before you go any further.

    http://www.graftonplc.com/operations.html - Ok, a very crude example but it illustrates the fact that Grafton is highly dependent on the fortunes of 2 markets, which are both in recesson.

    The DIY section won't be fit to carry the entire Grafton group - it only made up 11% of the entire groups revenue last year.

    You have to ask yourself why you think the present share price is cheap? Is there some unlocked value that the market is missing? If you are basing your analysis on the asset base they hold, you have to ask yourself if the asset values on the books are reflective of the current environment?


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