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Investment in Wetherspoons

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Submitted By owenh
Words 273
Pages 2
Business Environment
Personal Opinion on investing £250,000
After reviewing our report, my decision is to invest in J.D Wetherspoon. The report has given me many reasons to invest in Wetherspoon; the company is highly established in the UK market for their value for money food, drinks and special offers. Their public houses are highly understood to be busy most evenings and throughout the day with mixed types of people. The breakfast business they tried hard to develop - paid off, with sales up by 40%. In recent times, where many public houses have closed – Wetherspoons has purchased the premises and opened their brand of public houses and because of their model selling value for money drink and food, this is popular and sells very well. I feel the company is able to foresee obvious changes and able to adapt their business model to adapt to the changes quickly, yet efficiently – such as the Challenge 21 and smoking ban.
The company’s operating profit has been healthy which expresses relief for me investing; the most recent report was £58.8 operating profit. Wetherspoons has a secret advantage against rivals, which is they have low and stable debt and interest levels. The company is able to borrow at 5.4% unlike The Slug and Lettuce at 8.7%, this shows the company has a stable financial structure. The dividend yield is low, but is higher that a bank would offer you for the money. Overall, I feel the business has a successful business model and huge market which the company can then adapt itself to deal with any changes and not lose market

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