Anyone have a view on the long term potential of a large cap grocer?
SWY, KR, SVU. All trade at anemic ev/ebitda multiples. KR and SWY are levered less than 2x on a net debt to ebitda basis. Predictable cash flows. Majority of Walmart impact is already felt. Stocks are out of favor on deflation and their capital spending in 2005 - 2007 was aimed at looking more like whole foods - not what the consumer wants at the moment , but a cyclical problem.
Anyone see any lbo potential here? Outside of "you cant get 12bn of lbo financing today june 17th 2010" - im talking in general here - over the next few years.