DIA: Waiting for the strategic plan (Bankinter Securities)
some investors are wondering whether now is the right moment to enter the stock. We do not think so. Throughout this initiation of coverage report, we have given a hard look at the company, its competitors and the developing trends within the grocery business, and come up with the conclusion that the environment is getting more and more difficult for DIA. The potential silver lining is the strategic plan (to be presented this October). Would it come up with effective solutions? There have already been some hints, like a new format focusing on food on-the-go and longer opening hours, but we have yet to see a comprehensive presentation. Our Hold recommendation and target price of €2.01 / share (offering an upside potential of 1%) is based on several reasons: the aforementioned limited growth potential, powerful competitors and the risk of higher-than-expected capex.
Distribuidora Internacional De Alimentacion is a supermarket and convenience store group based in Spain. Co. is engaged in the retail trade of food through cut-price self-service supermarkets and franchise establishments. Co. is engaged in the operation of stores located in Spain, France, Portugal, Turkey, Argentina, Brazil and China.
Bankinter S.A. is a Spanish brokerage firm established in 1989. The company's line of business includes the provision of market research and trading services for Equity and Fixed Income products.
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