Balanced Portfolio - Treasury Wine Estate
Date: 30/01/2024
*** GENERAL AVICE ONLY***
Treasury Wine Estates Limited (TWE) stands as a distinguished global wine enterprise, delighting consumers in over 70 countries with its renowned selection of wines. These wines, including the celebrated icons from TWE, are widely accessible through a variety of channels such as major retail stores, select wine shops, upscale restaurants, trendy bars, and convenient online platforms. The company boasts a robust team of 2,500 professionals spread across key regions including Australia, New Zealand, Asia, the Americas, the United Kingdom, Europe, the Middle East, and Africa. TWE’s operations are bolstered by three primary divisions: Penfolds, Treasury Premium Brands, and Treasury Americas. These divisions are efficiently supported by centralized business services, supply chain management, and corporate functions. At the core of TWE’s success is its global, multi-regional sourcing model, which encompasses approximately 10,100 vineyards and state-of-the-art production facilities, strategically located in some of the most prestigious wine regions across the globe.
DOAU Acquisition
*** Trade Plan ***
The recent positive speculation about the removal of trade tariffs from China this quarter was squashed by a massive cap raise of $825m at 10.80 per share to fund the acquisition of high-end Californian wine group Daou Vineyards in a deal worth up to $US1 billion ($1.6 billion) as it steps up expansion in the United States luxury wine market.
With the recent strong consumer spending in all markets over the Christmas period, the acquisition filling a gap in their range and the CEO having strong US market experience, we see TWE as a good opportunity at these levels with the upcoming positive catalyst of the Chinese market coming back online
Mkt Cap: $8.5B
PE: 30
Yield: 3.34%
Total Portfolio Allocation: 3%
Entry: $10.5 | Target: $12.5 | Stop: $9.5
Disclaimer: The recommendation given is general advice only. It does not take into account your personal objectives, financial situation, or specific needs. This information should not be your sole resource when making such decisions. We strongly recommend you to seek the advice of financial, taxation, and legal professionals before finalising any investment decisions.