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Ever Read Sir Gawain and the Greene King? Well, this Brewer Needs No White Knight to keep on Making Cash.

By Malcolm Stacey | Monday 10 July 2017


Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.


Hello Share Turners. Recent results from Greene King  (GNK) were a dose of good news in a difficult consumer market. Operating profits were up by about 5%, while revenues on the year were up nearly 7%.

We all know that rising revenues don’t mean too much except, as in this case, when the profits rise apace.

There’s almost bound to be a Greene King pub near you. It has  3,100 pubs , restaurants and hotels in villages and high streets. It has 1,200 tenanted pubs whose revenues grew 5.8% in the year to nearly £200 million 

OK, I know a lot of Shareprophets readers are wary of breweries, as they see boozers closing down in their own neighbourhoods. But  the biggest and best in the game, of which Greene King is one, are likely to benefit from that diminishing competition.

After all, I see no signs of the average Britain's slavish devotion to alcohol slowing down.

And the divi is enticing. Did you know that in real terms the Greene King divided has put on weight every year for twenty years? Now, the prospective dividend yield is approximately 5%, with the payout up by 3.6% this time

It’s brand names are pulling em in. They include Hungry Horse, Flaming Grill and Wacky Warehouse.

Two years ago, Greene King took over a well-known outfit called Spirit. This has enabled it to do much more in the ordinary folk’s restaurant trade . It will not have escaped your notice that Brits are dining out more than they used to - a combination of ever busier working lives and laziness 

Buying shares in Green King could cash in on that trend. and, though we must factor in that low wages for most of us is not exactly encouraging, the dining out trend, the more reasonable end of the restaurant trade still seems worth a look.

Unlike the Punter’s Return.

 


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