Topic: How To Invest

The Successful Investor Hotline – Friday, November 23, 2018

Article Excerpt

METRO INC., $44.97, Toronto symbol MRU, operates over 600 grocery stores and 650 drugstores, mainly in Quebec and Ontario. On May 11, 2018, the company completed its acquisition of Jean Coutu Group. It operates 418 franchised drugstores in Quebec, New Brunswick and Ontario. Metro paid $4.5 billion (75% in cash, 25% in shares). If you exclude costs related to that acquisition and other unusual items, Metro earned $161.0 million in its fiscal 2018 fourth quarter, ended September 29, 2018. That’s up 22.8% from $131.1 million a year earlier. Due to the additional shares outstanding, earnings per share gained just 12.5%, to $0.63 from $0.56. That matches the consensus estimate. Overall sales rose 15.7%, to $3.77 billion from $3.23 billion. The new Jean Coutu operations contributed $690.7 million to the latest total. If you disregard the new operations and an extra week in the year-earlier quarter, sales rose 2.5%. Food same-store sales improved 2.1%. Higher prices accounted for about 40% of that gain. Same-store sales…

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