RE:RE:RE:RE:RE:Buying at Maximum Pessimism Happy New Year!
There are many different ways to think about Gretzky brand and what it will mean in the future vs now. One way is mass market volume approach while another is something special that is a status symbol.
Each has its pros and cons.
Mass market inexpensive "bulk" wines are a somewhat homogeneous product while premium specialty wines are from a terroir with a provenance.
I think management has rightly chosen the second option because they realize Gretzky Estates is about an elevated experience with the cocktail lounge selling wine at $18 a glass. I have no clue how much revenue the physical Estate generates but its a must for tourists.
Whats the Gross Margin on an $18 glass of wine or a $20 cocktail?
Whats the Operating Margin on an $18 glass of wine or a $20 cocktail considering there is no distribution cost and limited taxes?
A bottle of icewine will be a lot more profitable if bought from Estate vs LCBO.
The hockey rink was and is a game changer making the winter season a thing. Management can build out the winter season by offering other activities that guests pay for like curling, luge, etc. This could be very profitable. Example: At Old Quebec toboggan rides are $4 https://au1884.ca/toboggan-slide-tickets/
In my opinion Peller becomes investable if it can transition to Estate Experiences while weathering the tornado thats going to pass through the Wineshops in 2026. The company is not profitable now without government subsidies imagine in 2026 when a strenght becomes a weakness. Many Wineshops will have to close