Retail Stocks out of favour for too long

by Gary Glover

Discretionary Retail stocks have been going in the opposite direction to the market in the last 12 months.  The sector has been in a large decline since November last year, so basically the stocks have pulled back 3/4 or more of the previous years range - a very large correction indeed.  Some of these stocks are starting to represent good value here and although the retail sector is experiencing tougher times, the good companies generally seem to prosper and turn positively when the cycle changes.  In particular, MYR and JBH are the two stocks that stand out currently.  The P/E is at the lower end of their trading bands and 7.5% and 5.5% yields on MYR and JBH look very enticing here.  As a contrarian investor it could be time to start looking at these two quality companies.

Disclaimer

Gary Glover is an Authorised Representative (Rep No. 259215) of Novus Capital Limited ("Novus"). Novus is a holder of Australian Financial Services Licence No 238 168. Novus, its directors, officers, associates and employees each declare that they, from time to time, may hold interests in financial products and/or earn brokerage, commission, fees or other benefits from financial products mentioned in this e-mail or attached documents. Unless specifically stated within this page or an attached document, any information communicated by this e-mail constitutes unsolicited general financial product advice which has been compiled without regard to any investor's individual objectives, financial situation or needs. It is not specific advice for any particular investor. Before making any decision about the information provided, you need to consider the appropriateness of this information having regard to your individual objectives, financial situation and needs and consult your adviser. Any indicative information and assumptions used here are summarised and also may change without notice to you, particularly if based on past performance or relate to a future matter.