Goodfood Market Corp. (FOOD.TO)

(A Top Pick Sep 25/17, Up 6%) It is the largest such company in Canada. It has tripled its subscriber base recently. They are in Eastern AND Western Canada. They are a disruptor. There is no inventory or wastage as people order exactly what they need. It goes straight from the distribution center to your door. He thinks this will make a very attractive target for a Canadian grocer.

A core holding for him. He participated in the new issue. They have market share estimated at 40%. A very well managed company. They have much higher customer loyalty and lower customer turn than others. They are managing their costs. They are spending a lot in marketing. They are investing in the growth of the business to get greater market share. It is cooking for dummies. He thinks they will do very well and could get acquired by a big grocery chain.

They are a meal kit company delivered to the home. Their penetration is incredible. The service is very big in Europe. They are focused on growth but focused on the bottom line also. He thinks the trend is here to stay. They could become an interesting acquisition target.

This is in the new, emerging "meal kit" business. The concept is interesting. As people's lives get busier and they don't want to order in every night, this concept is gaining steam. There are a number of upstart companies in the US that have been growing very rapidly. This company has done a great job of growing their subscriber base and revenues, and is a very interesting company to watch. However, it is early stage and not making a lot of money. You have to look at this as a 3-4 year investment. He is watching and monitoring this with interest.

He has been accumulating stock and really likes the company. Canada has a long way to go to catch up to Europe and the US. They just moved into a new Montreal facility. They are moving out west next year. If you get in now you should make a lot of money. It is a great subscription model.

They have about 40% of the market. They disclosed there are up to 31k subscribers. They just went public in June. They are full of cash and now increasing their distribution facility in Montreal 10 fold. They will open a facility out west next year. It would make sense for a large grocer to acquire this one to get into the business of direct delivery to the home. They have great management. (Analysts’ target: $2.63).