Although we think Associated British Foods' mass apparel retail division, Primark, should deliver consistent growth through its expansion over the short term, supported by reliable performance from the remaining largely commodified food divisions, we believe the company’s potential will be limited over the long term by intense competition and a lack of differentiation, leading to our no-moat rating.
Primark is in the expansion phase, and new store additions will likely drive earnings growth for years to come.
The lack of an online retail business represents a potential hindrance to long-term growth, as Primark stands to miss out on about 50% of consumers’ budget allocation to the channel by 2029.
|
Metric
|
ABF
|
HM B
|
GPS
|
|---|---|---|---|
Price/Earnings (Normalized) | 14.52 | 24.74 | 12.72 |
Price/Book Value | 1.69 | 6.64 | 3.21 |
Price/Sales | 0.95 | 1.16 | 0.59 |
Price/Cash Flow | 9.03 | 7.72 | 7.30 |
|
Metric
|
ABF
|
HM B
|
GPS
|
|---|---|---|---|
Quick Ratio | 0.85 | 0.55 | 0.62 |
Current Ratio | 1.79 | 1.08 | 1.50 |
Interest Coverage | 6.26 | 10.84 | 8.81 |
|
Metric
|
ABF
|
HM B
|
GPS
|
|---|---|---|---|
Return on Assets (Normalized) | 6.91% | 6.19% | 6.85% |
Return on Equity (Normalized) | 11.72% | 24.55% | 30.74% |
Return on Invested Capital (Normalized) | 8.74% | 10.89% | 9.22% |
|
1-Day Chart
|
Name
|
Price
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|---|
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