Consumer Staples
Chewy still to come calling?! Andrew Hollingworth’s recent bull thesis (highlighted in The Cut here) has proved to be extremely well-timed as the pet food retailer becomes embroiled in a takeover battle. However, Andrew believes Chewy could still gate crash the party. If it wants to hit the ground running in pan-European expansion Zooplus is only one asset that will enable it to do that and the price it can likely get it for is hardly outrageous.
Edition: 119
- 17 September, 2021
Zooplus (ZO1 GR)
Consumer Staples
An online-only niche business that has outcompeted Amazon and built real scale economics - it has a 40% share of the EU online pet food market and its customers love it, but Mr Market less so. Why? Well, it is a little old-fashioned in its desire to grow slow and steady, generating scale, customer loyalty and cash along the way. Its US peer (Chewy) has grown itself and its end market (US only) far faster and as a result trades on c.5x sales (vs. Zooplus on a lowly 0.88x). One day either Zooplus’ scale economics payoff or Chewy comes calling…
Edition: 113
- 25 June, 2021