Investing in Boring Businesses

VLGEA is a boring business. It operates a chain of ShopRite groceries stores across PA, NJ , and MD . The company averages a modest 6% sales growth CAGR and has paid a dividend every year since its inception in 1965. I like investing in boring businesses. Stable, consistent returns on shareholder capital can have tremendous compounding effects.

VLGEA sits on a ton of cash, has stable, consistent free cash flows with an unlevered FCF 10Y CAGR of 29%. Although the company faces stiff competition in an industry that already deals with narrow margins, they have flexibility and potential to get to their intrinsic business value of around $31 - $36/share.

I wrote a blog piece about them where I go into more detail, give it a read here:

From a technical standpoint, if the stock can hold at this current support level of 22.50 - 23, I would venture to initiate a starter position with a stop loss right below that support. Any price acceleration from the bottom I would add on to my position.

Please let me know if I missed anything, or if I have any blind spots in my analysis, it really helps!

I couldn't agree any more.
rockvuecap IllusionsCatcher
@IllusionsCatcher, Thank you!
@rockvuecap, You're welcome. Thank you for posting. May the roses in our gardens never fade. May our accounts grow obscenely fat.
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