The first issue is the price Sainsbury is paying for Argos, since DIY retailer Homebase is being sold off prior to the acquisition going through. Although the deal is being craftily financed through a mix of shares, cash on hand and financing from Sainsbury’s internal bank, the purchase is an expensive one. With the final price of 171.5p per Home Retail Group share, a 75% premium to their pre-takeover announcement price, Sainsbury is buying the struggling retailer at a very pricey 19 times forward earnings. Additionally, Sainsbury plans to close up to 55% of the Argos locations, yet it’s paying a fortune to buy stores it will then shutter.

Second, and most importantly, the acquisition does little to solve the larger issues each retailer is facing. Sainsbury’s management is pursuing the deal in order to place the Argos click-and-collect locations inside increasingly unpopular large out-of-town locations. Yes, Sainsbury has seen incremental increases in sales of non-food goods at these stores, and placing Argos outlets inside them will increase footfall and sales in the short term. But these small increases do little to answer the more fundamental problems facing the Argos and Sainsbury business models.

Market headwinds

Both companies are facing gale-force headwinds in their traditional markets. Sainsbury is losing market share to low-price rivals Aldi and Lidl, and Argos is being battered by e-commerce juggernaut Amazon. Sainsbury, like all the traditional grocers, has seen profits whittled away by the price wars that have sent operating margins falling to 2.71% in H1 2015 from 3.36% five years beforehand. While this decrease has been less than that of competitor Tesco, the Argos deal will do nothing to bring margins on bread and milk back to the level they were at before Aldi and Lidl arrived.

For Argos, operating margins have fallen from 6.7% in 2008 to 3.2% this past year as more and more customers turn to Amazon or other online retailers rather than wander down to an Argos store. The company has done well lately to build an enviable delivery network allowing same-day delivery across much of the UK. However, I find it hard to believe it can compete with Amazon on low prices while maintaining sufficient profitability to make the deal work. And profits 51% lower in 2015 than 2008 back this up.  

Furthermore, while some Argos customers may choose to buy some food at Sainsbury’s when they collect their homeware or electricals purchases, the two chains have very different customer bases. Sainsbury’s bulwark against the low-price sector has thus far been its wealthier customers. But bringing in the lower-end Argos brand risks turning away core customers and diluting that competitive advantage.

At the end of the day, for me the numbers don’t add up: why would combining two struggling retailers somehow create one thriving one? With a huge price tag, little overlap in customer base, and the risk of drawing management’s attention away from fixing the core businesses, I don’t see this deal being one shareholders will look on fondly years from now.

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Home Retail shareholders will receive 0.321 new Sainsbury’s shares, plus a total of 82.8p in cash for each Home Retail share they own.

The cash portion includes a 55p cash payment from Sainsbury. The remainder comes from a 25p payment relating to the £200m sale of Homebase, and a 2.8p final dividend from Home Retail Group. Home Retail shareholders would almost certainly have received these payments anyway.

In total, the offer is worth about £1.4bn, or 170p per Home Retail share. Home shareholders still have to approve the offer at a general meeting, but I don’t think there’s any risk of a revolt.

In my view, this deal is a good result for Home Retail shareholders. Sainsbury’s offer values Home Retail at around 20 times 2016 forecast earnings, which seems ample for a low margin retailer.

What about Sainsbury’s shareholders?

The big question is whether Sainsbury will make a success of integrating the Argos retail and financial services businesses into its own operations.

Sainsbury believes it can make savings worth £160m within three years. According to today’s announcement, the deal will provide benefits in three main areas.

Sainsbury wants to expand its non-food sales and banking businesses. The Tu clothing range is a particular focus. Sales rose to £800m last year and increased by 10% during the first half of the current year. The Argos customer credit business is also attractive. The £550m loan book should fit well with Sainsbury’s Bank and will ultimately be used to help finance this deal.

The supermarket chain also believes it can make big savings on property costs by moving a number of Argos stores into supermarkets when their leases expire. The group has trialled 10 Argos concessions in existing supermarkets for an average of 38 weeks. They’ve found that Sainsbury’s customers welcome the chance to buy non-food goods, while Argos customers like the free parking and easy access.

The final attraction is that Sainsbury believes that Home Retail is “a leader in online and mobile retailing”. Acquiring Home Retail is expected to improve Sainsbury’s online sales and the supermarket’s click and collect and delivery services.

Is Sainsbury a buy?

Sainsbury appears to believe that grocery sales are likely to remain fairly flat for a while, while sales of non-food items and general merchandise provide significant growth opportunities.

Current forecasts suggest that Sainsbury’s post-tax profits will fall next year, while sales remain largely flat. This isn’t ideal, but is diversifying the answer?

I think the truthful answer is that we don’t yet know. This deal should certainly cut the cost of running the Argos store network. I can also see that Sainsbury customers will be happy to pick up items at Argos while they’re in-store.

Sainsbury looked attractive without Home Retail, on a forecast P/E of 12.5 and with a 3.8% yield.

In my view, the worst case scenario is that this acquisition won’t boost sales or profits, which will remain flat. The risk of an outright disaster seems very low. On that basis I’d argue that Sainsbury remains a decent long-term buy.

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The retailer emerged as a shock £1bn target for Sainsbury’s (LSE SBRY) in November, but South Africa’s Steinhoff International got in on the action last month by making a £1.4bn bid for the catalogue specialists.

However, Sainsbury’s has been given free run on Home Retail Group after Steinhoff withdrew its offer late last week, leading the British supermarket to make a formal offer at the same price. The board of Home Retail Group said that it looked forward to “working towards a recommendation.”

Food for thought

Sainsbury’s chairman David Tyler has said that the deal “presents an opportunity to accelerate our strategy, delivering compelling revenue and cost synergies.” He added that “we will create a multi-product, multi-channel proposition with fast delivery networks that we believe will be very attractive to the customers of both businesses.”

Sainsbury’s is looking to reduce its reliance on the ultra-competitive food sector, an arena beset by an increasingly-bloody price war prompted by the fast emergence of low-cost rivals Aldi and Lidl.

And at face value this strategy would appear a sage one. Sainsbury’s saw like-for-like sales edge 0.1% higher in the last quarter, the first such rise for two years and one that was underpinned by strong demand for its non-food items.

Sales of entertainment products and clothing galloped 11% and 10% higher in the period, helped by the successful launch of its latest Gok Wan fashion lines.

Is Argos ‘back’?

But many analysts are concerned that the deal may have given Sainsbury’s too much to do. After all, the supermarket now has to battle to turn around two ailing businesses instead of one.

Sales at Argos have been more encouraging of late — a 1.1% sales decline during the 11 weeks to February 27 marks a vast improvement from the 2.6% slip punched in the year to February 2016.

And Sainsbury’s will be particularly pleased with the catalogue specialist’s improving fortunes in cyberspace, a hot growth segment for the retail industry. Online takings at Argos rose 13% year-on-year in the latest quarter, driven by the popularity of the firm’s new FastTrack same-day delivery and collection service.

Sainsbury’s also hopes that Argos’s rising online popularity — not to mention plans to bring Argos outlets into its supermarkets — will significantly bolster the cross-selling opportunities of its existing products.

Don’t expect miracles

Still, the supermarket has plenty of work in front of it to transform Argos into the digital retailer of choice and take the fight to Amazon. Like the grocery segment, Argos operates in a highly-competitive environment, and the firm needs to offer more than better delivery options to return to sales growth.

Besides, Sainsbury’s still relies on its traditional food business to generate earnings growth, prompting suggestions that the grocer would have done better using the funds to invest in developing its existing operations rather than splashing out on Argos.

While the firm’s diversification strategy certainly makes sense, I believe the headaches are likely to persist at Sainsbury’s thanks to the widescale competition across Britain’s retail sector.

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Supermarket struggles

Grocery giant Sainsbury’s (LSE: SBRY) has breathed a huge sigh of relief in recent months as diving sales over the past few years seem to have stabilised. I have long cast doubt on the longevity of any such recovery, however, as middle-tier rival Tesco can attest to — it also enjoyed a brief revenues renaissance around the turn of 2015.

The likes of Sainsbury’s have been reduced to little more than introducing round after round of earnings-crushing price cuts to take on the discounters. So news that Asda is due to slash the cost of hundreds of more products last week comes as a further headache, while news that Aldi plans to open a further 80 stores this year alone poses a more long-term problem.

And Sainsbury’s broader recovery strategy has received a further whack after its £1.3bn bid for Argos operator Home Retail Group was derailed by a £1.42bn bid from South Africa’s Steinhoff International on Friday. Sainsbury’s now has until March 18th to make a new takeover attempt.

Still, I believe Steinhoff International’s move actually does Sainsbury’s a favour — after all, the London firm has enough on its hands to turn around its own struggling supermarkets, let alone taking on the might of Amazon et al  in the general merchandise stakes with Argos.

Regardless of how the takeover pans out, I reckon Sainsbury’s still carries too much risk for savvy investors. A 16% earnings dip is pencilled in for 2016 alone, and although a subsequent P/E ratio of 11.3 times is an attractive ‘paper’ valuation, I believe the chain needs to show much more effectiveness in taking on Lidl and Aldi before I for one would consider investing.

A perilous power pick

Energy giant SSE (LSE: SSE) has been fighting a losing battle over the past couple of years to stop its customer base rotting. The steady rise of independent suppliers has taken a chunk out of the revenues performance across the whole ‘Big Six,’ with householders being egged to switch by consumer groups calling for severe price reductions in line with falling wholesale costs.

And the scale of Britain’s switching culture was laid bare by Ofgem data released this week. The number of consumers changing supplier advanced by 15% year-on-year in 2015, to 6.1 million, the regulator said.

Britain’s major operators have attempted to curry favour over the past year with a string of tariff cuts — SSE itself cut gas prices again in January, by 5.3% — but these moves are having little impact. The London firm saw total accounts fall to 8.28 million in December from 8.58 million just nine months earlier.

Not surprisingly the City expects SSE to suffer a 3% earnings slip in the year to March 2016, putting paid to firm’s long record of annual rises. A low P/E rating of 12.5 times — not to mention a dividend yield of 6.3% — may still attract investors, but I expect both earnings and shareholder payouts to come under increasing pressure in the years ahead.

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Property play on the charge

Property investment trust Shaftesbury (LSE: SHB) gave the market a bubbly trading update Friday, news that sent shares 2.3% higher from the prior close.

Shaftesbury advised of “continuing strong tenant demand” between 1 October and 4 February, “underpinned by robust footfall and spending“. The company said that strength in the London economy has supported strong tenant demand across both retail and leisure sectors.

The City fully expects earnings to keep accelerating at the London-based business. A 14% advance is chalked-in for the period to September 2016, leaving Shaftesbury dealing on an elevated P/E rating of 62 times.

A projected dividend of 14.5p per share for the year, yielding a handy 1.7%, lessens the blow of this heady multiple somewhat. And while Shaftesbury remains an expensive stock selection by conventional metrics, it could be argued the firm’s strong upward momentum — facilitated by its exposure to the strong London economy — fully justifies such a premium.

Divestment news drives shares skywards

Electronics manufacturer Premier Farnell (LSE: PFL) also made the headlines after announcing the sale of its firefighting and emergency response unit Akron Brass for $224.2m. News of the divestment sent shares 6.6% higher from Thursday’s close.

In other news, Premier Farnell also advised that profits for the year to January 2016 should fall within its previous guidance of £73m to £77m.

The divestment of Akron Brass will allow Premier Farnell to “pursue growth opportunities within the core electronics distribution business,” it said, not to mention boosting profitability in the current period and cutting its debt pile.

The number crunchers expect earnings to fall 18% in the year to January 2016, while a hefty dividend cut from 10.4p per share to 6.2p is currently pencilled-in.

But a 3% earnings bounceback is predicted for the current period, leaving the business dealing on a mega-cheap P/E rating of 8.7 times. And another estimated 6.2p dividend creates a bumper 6% yield.

However, as sales continue to deteriorate badly across its core European and North American markets, I believe investors should be cautious concerning current forecasts before piling into what is, conventionally-speaking, an ultra-cheap stock. I reckon Premier Farnell could be set to endure further travails as macroeconomic turbulence worsens.

Grocer on the ropes

Shares in struggling grocery giant Sainsbury’s (LSE: SBRY) continue to be volatile, thanks partly to the divisive move to hoover up embattled Argos owner Home Retail Group.

The stock price was more settled in Friday trading, however, and was last up 1% on the day.

Sainsbury’s finally nailed its acquisition of Home Retail Group this week after its first approach in November, a £1.3bn bid being enough. But I believe the business has bitten off more than it can chew — indeed, Sainsbury’s now has to revive two battered businesses at great cost.

The City expects Sainsbury’s to follow a 16% earnings decline in the year to March 2016 with a 3% dip next year, leaving the business dealing on P/E ratings of 11.3 times and 11.1 times respectively. And a predicted dividend of 10.6p per share through to the close of 2017 creates a chunky 4.6% yield, even if this represents yet another dividend cut.

But like Premier Farnell, I believe investors should continue to avoid the company. The competition from both discounters and premium chains continues to intensify, leaving Sainsbury’s little choice but to keep slashing costs at the expense of earnings. And I have little faith in the firm’s ability to resurrect Argos given its continued failure to turn around its own core grocery business.

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In my opinion, this is a bad deal for Sainsbury’s shareholders. Sainsbury’s grocery business is already outperforming the other big three supermarkets, with a slower pace of like-for-like sales decline and better market share retention. Trading conditons are challenging for the supermarket, but at least they are beginning to stabilize. By contrast, Argos’s outlook appears to be worsening, as like-for-like sales fell 2.2% in the 18 weeks run-up to the New Year, indicating the worst may not be over.

Strategically, a merger looks risky and seems to present few worthwhile synergies. Sainsbury has already been incorporating Argos concessions within its larger stores, and it should be able to roll-out further concessions without a complete takeover. This would remove much of the integration risks of bringing together two rather different businesses, and would be less of a distraction to management at a time when both sectors are undergoing some very significant structural changes.

On the financial side, the deal is cleverly structured so that Sainsbury’s retail banking arm would finance the acquisition of £600 million worth of consumer loans on Argos’s balance sheet. This allows it to raise up to £500m in cash from savers and thus reduce the burden on its own cash reserves. Nevertheless, free cash flow generation will likely worsen as Argos has additional investment needs in order to restore profitability.

Sainsbury’s dividend was cut by a third back in May 2015, and it looks as if further cuts will come within the next two years. With dividend uncertainty surrounding the stock and a risky acquisition strategy, I would rather stay out of Sainsbury’s shares.

Centrica’s (LSE: CNA) adjusted net income is expected to fall by 8% this year, after a 28% decline last year. A collapse in upstream profits following the downturn in energy prices over the past 18 months is mostly to blame, but increased competition in its supply business and unusually mild winter weather are also causes. Shares in the vertically-integrated utility company now yield 6.9%, but with earnings declining, its dividend could be cut again this year.

As energy prices continue to decline, Centrica will find it increasingly difficult to divest from its portfolio of upstream assets, and the continued ownership of these assets may lead to further momentum in the decline in earnings for the group. Furthermore, capital spending requirements to maintain production levels would burn through cash flow generated by its retail supply business, reducing the cash available for dividends.

Meanwhile, interdealer broker Tullett Prebon‘s (LSE: TLPR) dividend looks more secure. Its dividend is covered by almost twice earnings, and its earnings outlook is far more optimistic. A rise in market volatility, industry consolidation and cost savings should lead to growth in profitability. Earnings have been unusually weak as of late, but trends are finally looking up.

City analysts expect adjusted net income to have fallen 2% in 2015, and that 2015 should mark the bottom of the market. For 2016, adjusted net income should rebound by 11%, giving its shares a very appealing forward P/E of 9.2. Growth in earnings should support growing dividends too, and analysts expect dividends will grow 3%, to give its shares a prospective yield of 5.4%.

With the best dividend outlook of the three, I would rather buy Tullett Prebon.

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RBS continues to shed non-core assets such as its private banking arm and completed selling its final stake in the US Citizen’s Bank, further reducing RWAs and shoring-up capital ratios. While there will undoubtedly be further pain ahead for the bank in regards to further restructuring costs and regulatory fines in the US, management has done an admirable job of cleaning up the balance sheet and setting the stage for a return to growth at the state-backed lender. I wouldn’t be calling the bottom for shares yet, but with return on equity at the go-forward bank a solid 13%, there’s obviously room to grow for the group once it’s done cutting out non-performing divisions. With shares trading a price/book ratio of 0.27, compared to 0.91 at much healthier Lloyds, RBS looks like a high-risk, high-reward share that merits further investigation.

The Sainsbury factor

Argos and Homebase parent Home Retail Group (LSE: HOME) shares fell 4% on Friday when it was revealed that negotiations with J Sainsbury about the grocer’s takeover bid weren’t progressing as smoothly as shareholders hoped. With the £340m sale of DIY chain Homebase already lined up, Home Retail Group will be a largely-Argos-driven share if the Sainsbury’s deal doesn’t go through. Argos’s latest results saw same-store sales down 2.2% over the holiday period and full-year profits are expected to be towards the bottom of the already-downgraded £92m to £118m range. With earnings per share half of what they were five years ago and competition from the likes of Amazon not going away any time soon, I would certainly be hoping for the Sainsbury’s deal to go through if I were a shareholder.

Acquisition trail

AstraZeneca (LSE: AZN) has fully embraced the manic pace of acquisitions roiling the pharmaceutical industry and announced or completed some $7bn worth of deals in the final two months of 2015 alone. This shopping spree is necessary to refill the drugmaker’s pipeline as US patents on blockbuster drugs Nexium and Crestor, which account for 35% of revenue, expire by the end of this year. An ambitious target of increasing revenues by well over 50% to $40bn by 2023 will require continued acquisitions and increased R&D spend, which accounted for an estimated 20% of revenue this past year. Shares are certainly not cheap at 17 times 2016 forecast earnings, and the heavy capital expenditure necessary to meet revenue targets makes me view other pharma giants such as GlaxoSmithKline or Shire as more appealing options.

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Give groggy grocer a wide berth

Much-maligned supermarket giant Morrisons (LSE: MRW) cheered the market with rare positive trading results last week, giving investors renewed hope of a long-awaited turnaround.

The Bradford chain advised that like-for-like sales crept up 0.2% in the nine weeks to 3 January. Although these results can hardly be considered rip-roaring, Morrisons’ first such sales advance for more than a year is certainly worthy of celebration.

And hopes of a prolonged uptick at Morrisons would have been given further fuel by positive sales numbers from fellow mid-tier operator Tesco. The business advised that its own underlying sales nudged 1.3% higher in the six weeks to 9 January.

But the introduction of further discounting at both chains was responsible for giving till activity a strong boot in the right direction, a strategy that is helping sales at the expense of the bottom line.

On top of this, poor retail numbers at both Sainsbury’s and Asda over the festive period suggest that the mid-tier grocers are still struggling to hold their ground against discount retailers Aldi and Lidl, both in-store and online, not to mention premium chains like Waitrose.

Morrisons’ decision to shutter its Westgate store in Bradford (its only shop in the centre of its home city) is a depressing metaphor for the company’s ongoing troubles. Sure, the move to close the underperforming outlet along with six others is undoubtedly a step in the right direction. But earnings aren’t going to recover until revenues improve without the aid of crippling price cuts.

The City expects Morrisons to chalk up a 16% earnings decline in the year to January 2016, the third decline on the spin if realised. The business has consistently failed to gets its transformation plan firing despite scores of token initiatives and even personnel changes at the top.

And with its competitors steadily expanding I believe much further pain is in store for Morrisons.

Catalogue play under the cosh

The newsflow surrounding Home Retail Group (LSE: HOME) has been dominated by the recent £1bn takeover attempt launched by Sainsbury’s. Indeed, the stock has seen its share price shoot 54% higher since the supermarket confirmed it had made an approach to hoover up the Homebase and Argos owner.

Although Home Retail Group had rebuffed the approach made back in November as it “undervalued” the business, not to mention its long-term growth potential, the sale of its Homebase outlets to Australia’s Wesfarmers on Monday is said to clear the path for a fresh buyout bid in the weeks ahead.

But whether or not Sainsbury’s elects to snap up the Argos operator, I believe Home Retail Group remains in severe peril as competitive pressures increase. Like-for-like sales at its catalogue business fell 2.2% during the 18 weeks to 2 January, the firm advised last week.

The City has pencilled in a 23% dip for the year to February 2016, a third annual dip out of five if realised. And like Morrisons, I don’t expect the bottom line to improve any time soon thanks to the impact of profit-crushing discounts.

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This week, however, some retailers have surprised on the upside, especially WM Morrison (LSE: MRW) and Tesco, both of whom have pleased the market.

Let’s be honest, it’s been rare to see our listed supermarkets outpace the FTSE 100 of late, but this seems to have been one of the best places to be invested (at least over the last month that is).

On a roll

As we can see, the best performer (perhaps surprisingly) is embattled WM Morrison. Clearly the market had become too pessimistic about its trading, which can lead to some significant gains if results, when published, surprise on the upside.

Looking through the Christmas trading statement, it seems to me that there were plenty of points that have helped to move the price, including:

• Internet sales grew by nearly 100%.
• Net debt was again guided lower to £1.65bn-£1.8bn at year-end.
• Cash flow improvement programmes were outperforming original expectations and management now expects the benefits, specifically working capital and property proceeds, to be greater than first anticipated.

However, turning to valuation, on a forecast price-to-earnings ratio of over 15, according to data from Stockopedia, the shares don’t scream ‘cheap’. There could well be significant hidden value trapped in the books, an example of which I witnessed when Avesco Group, a company in which I’m a shareholder, announced that it had sold its land and buildings at a site near Wembley (which as at 31 March 2015 had a net book value of £5.3m) for £16m.

Argos it

So, what is it that makes me prefer J Sainsbury?

Well, it’s quite simple really. For me, there are more things to like about J Sainsbury:

• On a forecast price-to-earnings ratio (12 times earnings) and on a price-to-tangible-book basis (0.82) the shares are much cheaper than WM Morrison.
• The speculative bid for Home Retail would formally bring together two trusted brands (don’t forget that Argos has already been operating in some larger format Sainsbury stores) and importantly, logistical infrastructure could be rationalised to a degree.
• Across the combined group there would be, I suspect, a big overlap in property, a portfolio that could be rationalised by management.
• Even if the deal doesn’t come off, the initiatives that management has put in place to win customers back seems to be on track for now. And investors are being paid a yield of over 4% while they wait – that’s more than the forecast yield of WM Morrison and Tesco combined!

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This isn’t a normal situation, however. Home Retail is currently negotiating a possible offer for Homebase and is on the receiving end of takeover interest from J Sainsbury.

Does today’s news do anything to change the outlook for Home Retail shareholders?

What the numbers say

Like-for-like sales at Argos fell by 2.2% during the 18 weeks from 30 August to 2 January. The group’s gross profit margin also fell by 2.25% during the period. This suggests to me that despite price-cutting and promotional activity, Argos stores are struggling to maintain their share of the market, especially in consumer electronics and white goods.

There were some signs of hope. New Argos digital stores contributed 3.1% to sales, mainly from concessions that have been opened in Homebase and Sainsbury’s stores over the last year. In total, Argos sales rose by 0.9%.

Internet sales growth also continued and online sales now represent 53% of all Argos sales, up from 49% last year.

At Homebase, like-for-like sales rose by 5% despite a 4% decline in total sales. This suggests that the group’s programme of store closures is helping to weed out underperforming locations and leaving a stronger group.

The overall picture is disappointing, but I don’t think it will be bad enough to discourage the takeover interest in the group. Given this, should investors buy, sell or hold the shares after the 52% gain seen so far this year?

Homebase offer

On Wednesday night, Home Retail announced that it’s in “advanced discussions” with Australian retail group Wesfarmers over a potential £340m offer for Homebase.

This deal seems likely to go ahead. According to Home Retail, this would be likely to result in a £200m cash return to the group’s shareholders. That’s 24.6p per share for Home Retail shareholders.

Home Retail’s share price hasn’t moved this morning and stands at around 150p, suggesting that the market is valuing Argos and the group’s financial services business at about 125p in the absence of a fresh offer from Sainsbury.

Will Sainsbury buy Argos?

Sainsbury is clearly keen on buying Home Retail Group. Chief executive Mike Coupe believes that Argos would help Sainsbury acquire more market share and improve its home delivery capabilities. Home Retail’s finance business would be an attractive addition to Sainsbury’s bank.

The big question for investors is how much Sainsbury will offer to pay for these assets.

According to recent press reports, an offer of between 160p and 200p seems likely. That would value Argos and Home Retail’s finance business at between £1.3bn and £1.6bn and would be likely to be paid in a mixture of cash and new Sainsbury shares.

With Home Retail shares currently trading at around 150p, some further gains are possible. But if the Sainsbury deal does fall through, I’d expect Home Retail shares to fall back into the 100-120p range.

There’s still the potential for further profits. However, in my view, the balance between risk and reward suggests that it makes more sense to sell or hold Home Retail shares, than to buy them.

It’s your choice.

The post Is Takeover Target Home Retail Group Plc Still A Buy After Today’s Update? appeared first on The Twelfth Magpie.

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Roland Head has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.