Coles Group Ltd (ASX: COL) shares rocketed 3.12% higher on Tuesday to close at a new record high.
The Aussie retailer closed at $16.17 per share on the ASX to continue its strong momentum in November. Coles shares have now climbed 7.87% this month and are up 38.09% since the start of the year.
So, why is your ASX investment surging higher and should you be buying more in 2019?
Why Coles shares are rocketing higher this year
2019 has been a real test for Coles as the retailer has enjoyed its first full-year away from the Wesfarmers Ltd (ASX: WES) group.
Strong earnings have been the key to success as Coles has outpaced rival Woolworths Ltd (ASX: WOW) on the ASX in 2019.
Both companies' shares are ahead of the S&P/ASX 200 (INDEXASX: XJO) in 2019 but the Coles share price has momentum behind it after a strong October quarterly result.
Coles delivered first quarter sales revenue of $8,695 million, which represents 1.8% growth on the prior corresponding period (pcp).
Supermarket sales climbed higher while strong online sales were another core growth area. Coles' Liquor and Express segments also delivered strong growth in the first quarter.
The Express segment has been under pressure in recent years and this could be a sign that times are turning for Coles.
Is Coles a good value buy right now?
It's always a tricky one deciding whether to invest in a company at record highs.
On the one hand, Coles shares clearly have some momentum behind them in November, which could be a big plus.
If Coles can deliver strong sales through to its half-year result in February then it could be a bargain right now.
However, the company's shares could also be overvalued at a 20x price-to-earnings multiple.
Woolworths shares trade at 34.5x earnings, which may make Coles seem cheap, but it also has less than half the market capitalisation of Woolworths.
If you're looking for dividend yield, then Coles' 1.48% per annum falls short of Woolworths (2.60% p.a.) on the income front.
