Woolworths’ high return on equity has been skewed by the $12 billion spin-off of its liquor retailing and hotels business Endeavour and the depressed value of its supermarket sites on the balance sheet, MST Marquee brokers say.
The concept of return on equity – at 26 per cent for Woolworths and higher for its major rival, Coles – became a political football at a parliamentary hearing on Tuesday, after Greens senator Nick McKim used it to accuse the retailers of “making off like bandits”.
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Tom Richardson writes and comments on markets including equities, debt, crypto, software, banking, payments, and regulation. He worked in asset management at Bank of New York Mellon and is a member of the CFA Society of the UK as a holder of the Investment Management Certificate. Connect with Tom on Twitter. Email Tom at tom.richardson@afr.com
