Treasury Wines updates guidance, lifting the margin, but lowering EBIT quantum overall, with pressures on the commercial segment.
Branded product like Penfolds not feeling the consumer slowdown/inflationary-substitution pressures.
$580m-$590m is the new range guided, vs $602m consensus previously, a ~2% change, but it is a high multiple stock (24x forward).
Still, that $580m-$590m is in context of FY22 EBIT at $527, so the growth rate over prior year remains double digit (11-13%).
Somewhat like Amcor, we would suggest that other companies, of lower quality, moat, and pricing power will be under far greater stress as the consumer normalises expenditure patterns.
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