WOLSELEY..CHARTS, NEWS AND VIEWS

Hi bozzle

I'm not adding cos I can see better opportunities with less downside.

Planning to run this "winner" till it gets to 14-15.00. If in the meantime it goes back under ~11.75 I'll sell. If it goes under ~10.50 I'll buy it again.

To your points about financials. WOS is geared under 60%. It generates ROCE of 13%. As far as I am concerned they can borrow as much as they like at what, base plus 2 when making that sort of return? The main point is their growth in EPS about 15% historically. Who cares if it's done by acquisition rather than organic provided they make a decent return after the cost of capital. It's this that's underpinning the share price.

Granted there is lots of jiggery pokery on the BS regarding goodwill, and the margins are quite skinny but much of their free cash is effectively going back into the business to service debt / expand their footprint.

This bad boy is the Wal-Mart of Building, Heating, and Plumbing materials supply. It'll hit the buffers and stop growing at some point (and the shares will get re-rated downwards) but not at any time soon in my view.