High-street newsagent and bookseller WH Smith (LSE: SMWH) has spent years defying the sceptics. Many analysts struggle to understand why it hasn’t become yet another high-profile British retail casualty.
They point to the company’s inability to generate higher sales as a key weakness, particularly at a time when many of the items it sells are also sold online, or in supermarkets.
Yet, the business remains in rude health, as shown by last week’s trading statement. It continues to generate lots of free cash flow, mainly due to its ability to sell stuff to captive customers [...]