Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (1) | Ignore Thread Prev | Next
Author: mcone Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 426  
Subject: Valuation Date: 8/28/1999 7:47 AM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
Buffet and Munger have cited Wrigley several times as the type of company they admire. But I don't believe they have ever actually bought any WWY shares. Paraphrasing Munger at a recent Berkshire annual meeting: Wrigley is a great company BUT everyone knows it. Therefore it is very difficult to purchase the shares at a discount to its inherent value. My own personal valuation estimates over the last five years tell me that WWY normally trades at about a 30% premium over inherent value ( based on discounted free cash flow). The current inherent value according to my estimates is about $70/sh. So WWY is about as close to fair value as it gets right now.

I think the earlier comments in this board about growth in Asia are right on the mark. There are billions of people WWY has not yet reached. And a lot of them still smoke, which I believe is one of the drivers of gum consumption ( trying to give up cigs that is ). So WWY growth rates stand a good chance of improving. And remember, WWY stands alone as the clear leader in chewing gum worldwide. Even Coke has Pepsi to contend with. McDonalds has Burger King. But Wrigley is one of the, if not THE most dominant brand name around.

Bottom Line - WWY represents a good buy now but a long term dollar cost average program with a WWY DRIP will also be very rewarding over the next twenty years.
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (1) | Ignore Thread Prev | Next

Announcements

2013 Feste Award Voting Begins!
Who will win the 2013 Feste Award? Vote now for the Fool that most exemplifies the Fool Community mission of Learning Together!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Berkshire Hathaway

Reestablishing the Middle Class
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement