Casino Guichard-Perrachon (Paris:CO)

Casino Guichard-Perrachon is a French multinational active in distribution. It has 307,000 employees worldwide, including 79,700 in France. The company was founded in 1898 under the leadership of Geoffroy Guichard. In 1992, the group, then headed by Antoine Guichard (grandson of Geoffroy Guichard), merged with the Rallye group owned by Jean-Charles Naouri. The latter became the majority shareholder of Casino and set up an organization based on short decision-making circuits.

Naouri reshaped the asset portfolio and sold its activities in Poland, the United States, Taiwan and the Netherlands, while strengthening its position in Brazil, Colombia and Vietnam. Casino then acquired the Monoprix brands (up to 50% of %), Franprix, Leader Price and Cdiscount. In France, one in two Internet users is a customer of Cdiscount, which has become the number 1 non-food retailer on the Internet in just a few years. The Casino group will become the sole shareholder of Galeries Lafayette by October 2013.

With 6,700 convenience stores, Casino is the leader in this sector in France. The model developed in France is based on a network of brands with differentiated and complementary positions with SPAR and Vival (convenience stores in urban and rural areas), Monoprix and Franprix (city center), Leader Price (discount), Naturalia (organic). 

The combination of commercial and real estate activities, in France and internationally, constitutes one of the Group's levers for increasing its value. It is supported in France by two subsidiaries: Mercialys, one of the main listed real estate companies, and Immobilière Groupe Casino, owner of the store walls.

In Switzerland, Casino is best known for the bankruptcy of the Magro group in 2013. After Carrefour, this is a second bitter failure of penetration of the Swiss market by French distributors.

Casino offers a generous running yield of 3.66%, but significantly less than the long term average which is 5.69%. This attractive valuation of the title is confirmed with a PER which is only 8.93. The company increases its dividend at a correct annual rate of 5.23%. The distribution ratio is particularly cautious, with only 31.90.

Casino is relatively insensitive to economic fluctuations, which translates into a volatility in CHF of 13.72% and by a beta of 0.70.

A historic player in the food trade in France, the Casino group is today one of the world leaders in distribution: it generates more than 50 % of its turnover in young countries with high growth potential, in Latin America and South-East Asia. The group bought the Thai interests of the Carrefour group for 860 million euros.

• 1^er distributor in South America
  
• 1^er food and non-food trade in Brazil
• 1^er distributor in Colombia
  
• 2^e from distribution in Thailand

This strong presence in emerging countries allows Casino to free itself from currency risk, especially that linked to the dollar. This translates into a $risk of -0.14, which means that a variation in the greenback has very little impact on the value in CHF of Casino. The EUR quotation alone does not explain this decorrelation, as the exports of European multinationals are usually impacted by variations in the dollar.

In the end Casino receives 4 stars. The yield is appreciable in the current times and this despite a low distribution ratio. The dividend growth is not extraordinary certainly, but it remains correct. In addition, the title is not very sensitive to market and currency variations, which can be useful in the event of a correction in the near future. In short, it is a title that I like, it is just a shame that we have just passed the ex-dividend date and that we have to wait a year before the next distribution.

Sources: Wikipedia, Yahoo Finance, Swissquote, dividends.ch