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People - I thought you get more picky the older you get, kids go on impulse, this tends to die away when you become more aware of the value of money?
You keep posting this out....almost as in desperation....
Nice find PP1
ELECTRICALTOU - Read a number of times in full to digest the calculations below. These are the calculations to show buying Boohoo shares up to £3.85 is a fantastic bargain and that the share price for Boohoo will be at least £35.88 in 10 years.
Estimate of the Intrinsic value price of a Boohoo Share.
1) 5 year EPS growth rate estimate from yahoo finance (analysis page) is 29.9% per year. From the balance sheet we can see that equity has grown from 85.5million in 2015 to 569 million in 2020. That is 46% per year compounded growth.
2) The 5yr historic PE from MSN Money price ratios is High of 70.86 and low of 37.69 is 52.7 average.
3) Current EPS (TTM) is 5.3p x growth rate 1.3 x 10 yrs = 69. Therefore the estimated EPS is 69p in 10yrs.
4) The earnings per share of 0.69 x the future PE of 52.7 gives a share value in 10 yrs of £35.88.
5) If you take 15% profits year on year from this sum you achieve a current fair price of £7.71
6) discount this by 50% for a margin of safety purchase price of £3.85. Basically you can buy this all the way up to £3.85 and still get a fantastic bargain.
I have run this calculation on a multitude of companies, and none meet the criteria. If you can find any companies with a solid history of exceptional trading like Boohoo that have lost substantial value through no real fault then please let me know of them.
ELECTRICALTOU - As Warren Buffett, share billionaire, says never buy a share that you wouldn't hold for 10 years.
Buying Boohoo up to £3.85 is a fantastic bargain, Boohoo share price will be £8 to £10 in two years time according to Paul Scott from Stockopedia Small Cap Value Report and will be at least £36 in 10 years according to calculations.
ELECTRICALTOU - I've held Boohoo shares since 2015 and I'm very happy to hold them for another 10 years plus. Boohoo is the only great growth share on the UK market. Boohoo have made mistakes in the past and have always put them right. Boohoo are always ahead of the game whether it be in running their business or getting things right. It's actions that count for me and you can be sure Boohoo's actions will be brilliant. If anybody can fix suppliers' problems in the UK and worldwide Boohoo can and will.
I get that I'm fairly new to this had some luck in buying premier foods at 20p, sold too early, bought back in and see what happens over the next couple of months, £1.50 looks possible in a couple of months, given results in Nov.
I think going back to Boohoo , 10m out of their pockets when they bought in at the low point shows greed, I think they need to dig a lot deeper to show a change and confidence. I like to think a statement from Chairman putting their hands up to the report would only help transparency?
ELECTRICALTOU - For me, I much prefer growth to dividends. Growth means Boohoo are using their profits to grow the company which is excellent for great growth companies like Boohoo.
Is there a possibility of Boo hoo to issue a dividend, its strange to me not to reward shareholders in this way given the risk to many who may not have bought in the yo yo share price when the allegations first came out and to build some interest in why you should hold shares, holding for growth seems a bit far off at the moment, how are they going to reach their £50m payout when shares reach £6 , without the confidence of shareholders?
If Boohoo can attract more mature, less fickle consumers to its sites, its goal of becoming a market leader looks realistic.
You probably don’t need me to tell you that Boohoo’s finances are also virtually bulletproof. Net cash at the end of August came to just under £345m — up almost £138m on the previous year. What a contrast to other stocks on the market!
My suggestion? If you’re a committed buy-and-hold investor, you can safely ignore today’s reaction. After buying the shares when the supply problems first emerged, I certainly plan on staying invested for some time to come.
Paul Summers owns shares in boohoo group. The Motley Fool UK has recommended boohoo group. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
Paul Summers teaches psychology and also holds the CFA Society's Investment Management Certificate (IMC). It won't come as a surprise to learn that he's particularly interested in how behaviour and cognitive errors impact on financial decision-making.
https://www.fool.co.uk/investing/2020/09/30/the-boohoo-share-price-falls-despite-great-results-whats-going-on/
The Boohoo (LSE: BOO) share price is down in early trading this morning despite the AIM-listed star issuing yet another very positive set of numbers to the market. Why is this happening?
Why is the Boohoo share price falling?
As I say, it’s nothing to do with recent trading at the Manchester-based business.
Thanks in part to a rise in online shoppers caused by the pandemic, BOO made £816.5m in revenue over the six months to the end of August. That’s 45% up on that achieved over the same period in 2019.
Importantly, this growth was seen in all markets in which it operates. In the UK, 37% more revenue was generated. That’s mightily impressive given that this is the company’s most established market.
However, it’s the international sales figures that really show just how quickly this company is grabbing customers. Overseas revenue jumped 55% in total, including a superb 83% rise in the US. All told, nearly half of revenue is now generated outside the UK. That level of earnings diversification should be very comforting for anyone already holding the shares.
If you think all these sales mean Boohoo is making money hand over fist, you’d be right. Pre-tax profit for the trading period was £68.1m. That’s an increase of 51% from 2019.
Based on today’s results and post-period-end momentum, BOO now expects revenue for the year to be 28% to 32% higher. Previous guidance was for a 25% rise.
Normally, such a prediction would be lapped up by the market. The fact that the Boohoo share price has fallen appears to be due to the cautious tone adopted by management. In today’s statement, the company said that economic uncertainty could lead to reduced public spending. It also warned that the number of clothes being returned could return to more normal levels following a reduction seen over the lockdown period.
Another reason for Boohoo’s decline today is the likely increase in capital expenditure by the company. Between £80 and £100m will now be devoted to improving its facilities and undertaking IT projects — higher than originally thought.
Marketing spend will also rise, perhaps in an effort to repair any reputational damage from the recent investigation into the company’s suppliers. Today, CEO John Lyttle simply said that the company had “established a programme to implement the recommendations of the report to make substantive, long-lasting and meaningful change”.
Buy and hold
Before this morning’s news, Boohoo was trading on a very rich 53 times forecast earnings. Nevertheless, I think this should be seen in the context of the growth it is achieving.
Having picked up the remainder of PrettyLittleThing and acquired “well-known women’s brands” Oasis and Warehouse over the period, I think the future looks very rosy.