gfp927z
3 years ago
Winmark - >>> This Retail Stock Is the Ideal Safety Play
Motley Fool
By Jason Hall and Matthew Frankel, CFP®
Mar 18, 2022
https://www.fool.com/investing/2022/03/18/this-retail-stock-is-the-ideal-safety-play/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article
The company's business model is very cash efficient.
For most of the past 12 years, Winmark ( WINA -1.48% ) has been profitable and a market beater for investors. In this video clip from "The Rank" on Motley Fool Live, recorded on March 7, Fool.com contributors Jason Hall and Matt Frankel take a look at what has made this retail business so successful.
Jason Hall: I'm going to show a chart here, that to me says a lot about what makes this such an interesting company. This goes back to 2010. This is the end of the recovery coming out of the global financial crisis and what Winmark has done over that period.
You have a yellow, a purple, and a blue line here. The blue line is earnings-per-share, the yellow line is operating cash flow per share and then the purple line is just cash flow from operations. You notice that those lines move up and to the right very well together.
Now this dip right here, that was the coronavirus pandemic crash. Which closed down lots and lots of retail locations and have lots of investors concerned about a lot of different companies that were in retail. The point is that this company has been able to grow its cash flows per-share for a very long time. Are you guys curious what Winmark actually does?
Frankel: I know because I looked them up before the show.
Hall: [laughs] Play It Again Sports, Plato's Closet. [laughs] A few other retail brands like that, that are focused on used stuff. Winmark owns the brands and it works with franchisees that operate a lot of these locations. It's a great model, a licensing model, very profitable, very cash efficient, passes on a lot of the risk to the owners and the franchisors, the retail list. That's an interesting structure that they've built.
If you look at some of the most successful retail brands in history, a lot of their business has been built on franchising, like Starbucks ( SBUX 0.57% ) and McDonald's ( MCD 0.80% ) is just a couple of examples of franchises that have worked really well. There haven't really been a ton of franchises in retail goods though.
This is a model that works really well, so what do they do? You've got some used roller skates, your kids too big, does anybody wear roller skates? How about rollerblades? Does that work? A baseball glove, whatever. A used one, your kids grown out of it, you take it that Play It Again Sports, they will give you some cash for it.
Yet you've got a kid that wants to try a new sport or you want to try a new sport? Why go spend $1,000 on a brand new whatever, when you can go spend a few hundred dollars on a used one for the kid whose parents had him try the sport last year and didn't like it, and ended up selling it. You can buy these used goods, high-quality stuff. It's a great way to get sporting goods at a much-reduced price and also to get money for your use sporting goods once you're done with them.
Again, the model has done really well, it's been profitable, it's been a market beater for investors, and it's a solid company, it is. I'd say it's a safety stock because it's largely de-risked from a lot of the things that can be risky about retail. It's somewhat recession-resistant because again it's countercyclical when consumer discretionary goods like sporting goods, people they don't buy them during recessions.
If they want to buy that stuff, they're more likely to look for a discount like Play It Again Sports. It gives it some security, doesn't have very much debt at all. I think it has less than $50 million in debt. Cash efficient business. Those are safe investments to own.
<<<
---
whytestocks
6 years ago
News: $WINA Winmark Corporation Announces Results of Its Self-Tender Offer
Winmark Corporation (Nasdaq: WINA) announced today the results of its self-tender offer to purchase up to 150,000 shares of its common stock for a price of $159.63 per share, which expired at 12:00 midnight EDT, on March 28, 2019. Based on the final count by Equiniti Trust Company, the d...
Read the whole news https://marketwirenews.com/news-releases/winmark-corporation-announces-results-of-its-self-tender-offer-7912962.html
Penny Roger$
13 years ago
Winmark Corporation is a franchisor of four value-oriented retail store concepts, which buys, sells, trades and consigns merchandise. It operates a middle-market equipment leasing business through the wholly owned subsidiary, Winmark Capital Corporation. The Companyβs middle-market leasing business serves large and medium-sized businesses and focuses on technology-based assets. The Company also operates a small-ticket financing business through its wholly owned subsidiary, Wirth Business Credit, Inc. It generates financing business directly from the customers, and also through the Wirth Business Credit franchisees. It also operates a small-ticket financing business through its wholly owned subsidiary, Wirth Business Credit, Inc. The Company small-ticket financing business serves small businesses.
http://www.google.com/finance?q=WINA