Now that the market seems to have woken up to the risks at Brambles (BXB, 210p, A$ 4.96) from a slowdown in world trade, and pricing pressure, I’m happy to close my negative view on Brambles.

We initially warned of the downside risk in the group following a directors share sale (Craig van der Laan de Vries) in late March 2008, when Brambles were trading above 420p.

We reiterated our caution in early June, ahead of what turned out to be a dismal trading update, resulting in the shares falling 14% on the day.

And lastly, last week we highlighted caution ahead of this weeks results, following which the shares fell by 20%.

So, whilst the outlook is likely to continue to deteriorate for Brambles, we feel that the recent share price correction has been indicative of the market now having a better understanding of the risks at Brambles.

Close negative view of Brambles:

March 23rd 2008 with 48% absolute return or 20% return relative to the market,

June 2nd 2008 with 44% absolute return or 16% return relative to the market,

February 10th 2009 with 25% absolute return or 20% return relative to the market.

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