Shares of WOW traded down to $24.40 last Tuesday; nearly reaching the key support level of $24.20 noted in our October 5th blog.
Prices have bounced since then as wholesale food reports show that deflation is returning to the fruit and vegtable market.
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Last week’s report showed a -2.3% price growth, which improves the margins on WOW’s private label brands, as well, as fresh produce.
We see the next level of price resistance in the $25.60 area and consider WOW reasonable buy/write opportunity at current levels.
Woolworths
