Dufry (DUFN SW) Switzerland

Consumer Discretionary

Hedgeye

Brian McGough believes we are nearing the “someone will take it private” price - while this would be a massive catalyst for the stock, Brian thinks the better play for shareholders is to realise the upside in the model over a TAIL duration in the public markets. He continues to see a leisure-led travel recovery, new peak operating margins, the Hainan JV with Alibaba, and significant financial de-levering as the cash flow story accelerates materially. Sentiment on the name is troughing and institutional interest is picking up. DUFN is the poster child for a company that will emerge from the pandemic stronger than it went in.

- 13 May, 2022

Dufry (DUFN SW) Switzerland

Consumer Discretionary

Hedgeye

If public markets don’t realise the value here, DUFN will be acquired by someone like Kering or LVMH - Brian McGough describes the “three stages to getting paid” on this dominant travel retail luxury consolidator. He argues that analysts are asleep on modelling top line recovery to 2025 where Brian is forecasting EPS of CHF 13.37 (over double consensus). With the company hitting new highs in growth, margins and ROIC, it should be hitting new peak multiples of 20-25x earnings. TP CHF 250+ (400%+ upside).

- 12 November, 2021