Woolworths is "long on assets and short on market capitalisation" says Vince Pezzullo, Portfolio Mananger, Perpetual Equity Investment Company.
Perpetual started accumulating shares late last year and picked up the buying following first half results. Pezzullo believes management have shifted their focus from sales growth to efficiencly, with sales per square metre now a key metric.
Despite widespread investor concerns about losing market share to Aldi, Aldi recently lost East Coast market share for the first time. "Our view is that Coles is run particularly efficeintly, if Woolworths is run particularly efficiently, which we think they're on that journey it will be hard for Aldi to grow."
With loss making Masters now closing, and the possibility of a spin-off of ALF Pub Group, the situation is also improving for Woolworths non-core busineses.
"We still like Woolies, we think it's a $30+ stock at some point".
Here are Vince's views on Woolworths, presented in September 2016.