Member Info for chilting

Regarding Kroger

It now seems unlikely that the merger with Albertsons will go ahead.

This will I think give Kroger fresh impetus to increase there online offering, especially in areas where they don't have stores.

This could be good news for Ocado, although the issue is still unresolved.

https://www.ftc.gov/news-events/news/press-releases/2024/02/ftc-challenges-krogers-acquisition-albertsons

Actually Ocado Group is progressing OK.

The problem is the poor sentiment associated with the reality of the dismal macro.

Growth companies always suffer when economic conditions are tight, especially with growth being so slow around the globe.

Currently most investors are primarily looking at profitable companies who are paying dividends - Ocado is clearly not going to do this any time soon.

But, Ocado remains an excellent long term investment and a strong buy for a long term hold at these levels.

Basically if you invest in UK listed shares, MKS is still an excellent option.

Although the macro is still dire and its still raining.

You just have to hope that the sun starts shining soon.

Is this so called disagreement actually a leak or is it simply press speculation or even bogus information fed to the media by someone shorting the stock - anything is possible.

Anyway, I think agreement be quickly be reached - probably before the Ocado Retail trading update in late March.

Ocado say they will treat Ocado Retail as an investment from April next year. The consequence of this will be that from that point Ocado Retail will basically come under a M&S remit. Assuming the business is in good shape by then, I think we will see a rebranding of Ocado Retail to M&S and probably an agreement to sell the other 50% to M&S with an extended payment period of maybe 5 years.

Its good to see a return to profitability at Ocado Retail - underlined today by excellent results from Ocado Group.

The following is very relevant for MKS shareholders -

Deconsolidation of Ocado Retail - from Ocado results.

"Ocado Group plc and M&S are both joint equal shareholders of Ocado Retail Limited. At present the results of Ocado Retail Limited are consolidated into the results of Ocado Group plc as Ocado Group plc are deemed to be the controlling shareholder via certain tie-breaking rights. Our current intention is to give up those tie-breaking rights to M&S in early April 2025. There will be no change in the economic interest of both shareholders in Ocado Retail Limited, or any consideration paid by M&S, as a result of this proposed change. After giving up the tie-breaking rights to M&S, we expect that the results of Ocado Retail Limited will cease to be consolidated into the results of Ocado Group plc and will instead be equity accounted for as an investment from this point onwards. From this point, M&S would have the right to consolidate the results of Ocado Retail Limited pursuant to the terms of the original Shareholder Agreement signed in August 2019 when the Joint Venture was formed."

What we are witnessing today is the renaissance of Ocado - bring it on!!!

I guess there is a good chance that some of these pioneer projects will need some Ceres kit at some stage as they progress.

Although the number one commercial opportunity in the UK still has to be converting wind power to hydrogen for storage and use by heavy industry, or back to electricity again for the grid.

In my assessment Ocado is well into recovery mode with Solutions starting to show much improved income and Ocado Retail back into profit.

I am quite sure that we will see a good rebound in the SP when the groups results are published on Thursday, followed by another leap up when we see the Ocado Retail trading update on March 26th.

A nice surprise this morning, and its a good one.

Trading inline with expectations, continued steady growth and a strong balance sheet with plenty of cash in the bank.

Also don't forget that Solutions income is increasing all the time as new CFC's come online around the globe and others gain capacity - the amount of increase here is the big unknown and has the capacity to surprise the market.

I guess agreement will come at some time between now and August.

Clearly Ocado Retail is being squeezed on margins at the moment and still has some excess capacity but the future is still bright for the business.

Its also fair to point out that M&S are doing much better out of the partnership than is evident from the numbers.

They are making profit on their own label products sold by Ocado Retail and also gaining on economies of scale for their own label products - this is also one of the main reasons why failed JLP Waitrose have crashed and burned.

Around 450p would simply be the recovery SP for CWR.

Good news in the future moves it much higher.

Remember the business model is licencing deals - the cash from licencing quickly becomes profit - the R&D has already been paid for over the years that Ceres has been trading.

UBS started coverage of CWR today with a Buy rating and price target of 450p.

Explains todays rebound in a moribund market.

As we all know, even the detractors, the SP is simply being mullered by sentiment - the potential here is still as good as it was when the SP was over 1000p.

Vertical farming has had problems getting going commercially because of high energy costs, but the early promise now looks like it will be fulfilled the hard way as entrepreneurs overcome this challenge.

Ocado investment in Jones Foods has been growing over the years and now Jones have just opened a large vertical farm in Gloucestershire, their second and by far their largest enterprise.

Vertical farming has the potential to be a massive industry - this is just the start.

https://www.business-live.co.uk/enterprise/ocado-backed-jones-food-company-28661653

The deal with Weichai will be the game changer - SP will fly - it could come literally any time.

China is now leading the world with renewables and Weichai are one of the main innovators.

On a side note - just to show why EV's are so popular in China - a small hatchback electric car can be purchased for around 9k on the road and for under 5k on Alibaba to export.

Also today - a very upbeat assessment from Interactive Investor confirming the positive sentiment expressed by most comments here.

https://www.ii.co.uk/analysis-commentary/insider-bosses-buy-ceres-power-shares-and-ftse-100-giant-ii530644

Support is as fickle as sentiment.

Probably the same thing with regard to OCDO.

Happy day today - tomorrow?

Eventually all days will be happy days - have patience.

Certainly Ceres is a gamble governed by sentiment.

Four years ago the SP shot up over 1500p, a valuation that was fuelled by sentiment and massively overbought.

Since then the SP has slowly deflated as investors have grown impatient with lack of progress.

It is though the time frame that is unclear, rather than what Ceres is capable of achieving.

Also there was a question mark over cash reserves as progress slowed but the Taiwan deal has probably sorted that potential problem - probably why the Directors are buying.

So for those who are patient Ceres remains a strong hold and for potential investors who are prepared to be patient, a strong buy.

Remember the licensing model converts cash to profit very quickly - the R&D has already been paid for.

I certainly don't agree that MKS is overbought.

Its just the macro and general low sentiment that's holding back the SP.

In my view all the market is undervalued in London at the moment.

Therefore, the solid best buys have to be companies such as MKS and WTB that are doing well despite the macro.

When the market does improve these will be the first to gain and they probably will go overbought quite quickly as share prices rise.

The news earlier this week that JLP had cut their redundancy remuneration package in half, just after a group of senior executives left the sinking ship, is followed today by the news that JLP is considering cutting 11,000 jobs out of a workforce of 76,000.

We shouldn't gloat but JLP with Waitrose is M&S's main competitor.

I wonder if Dame Sharon's redundancy package will be reduced by 50%?