Rainbow Rare Earths Phalaborwa project shaping up to be one of the lowest cost producers globally. Watch the video here.
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I have loaded up here. I appreciate the economy has change significantly but I have the intrinsic share value way way north of where this currently sits. I can see this back at £3 by the end of 2024. Patience is key.
£158m market cap. 124 stores. So over £1m price tag per retail outlet if you look at it that way. Revenue to market cap also close to 1:1 which is toppy when you consider other UK specialist retailers of this size at the moment. So price still looks half full as opposed to half empty to me despite the recent declines. It will be interesting to see how their new store layouts perform - and also what the refit cost is per store vs additional income they expect to generate. Japanese strategy looks sensible and hopefully there will be more international expansion plans announced.
Expected revenues at least 25% more than MC so not really a 1-1 ratio. However for me this isn’t the time to invest in the company. Like you I can see this heading further south in the short term. I reckon give it 12 months and I’ll be looking to get back in, all being well that is.
Yes, sorry. 2023 revenues expected to be around £200m compared to today's market cap of £141m. Zero profit. 2024 revenues expected to be below market expectations when they made the statement in June.
I have to say I really admire their branding and imagery which is really strong but in my mind investors have attached that same premium to the company's stock price historically which I don't think is justified today. Now sitting back and wishing for it drop into 70p territory which will make it much more realistic as an investment prospect compared to other shares out there.
Good luck with the 70p likeitornot. For me the current share price has been far too tempting and as a consequence I have loaded up significantly in last few months.
I would have agreed with your statement regarding a share price 'premium' being placed on it if it was still at £5 but its not, it's just ovr £1.
My opinion remains that by the end of 2024 we'll this back close to £3 a share.
I suppose we'll find out who is right in the end.
Hopefully we will both be right. The stat which values them at £1.1m per store (and associated share of online sales) just doesn't quite compute for me currently. They just need a convincing growth story to justify it I guess. The Japanese saga dented people's perception of how easy they could deliver on their international growth potential. I really hope that they can find a way to reach new markets as this will help to get to £3 and above again.
I'm Still a LTH here, as a family we've been buying HOTC chocolates since the original phone ordering days..... and bought a fair few of shares over the years for my wife... so I'm a fan of the company...
I dont really follow the logic of each store being a % of the mcap. The company has a reach far bigger than its own retail stores, ie concessions and online. That said, I think being a niche operator, which HOTC is, makes expanding the brand tricky. They failed at cosmetics and the rabot restaurant sadly died. Ive stayed at the St Lucia Hotel and its superb but not much room for growth on that side of the business as its only got a handful of rooms.
I'm not sure what the target of vodka is all about?
So, they start hot chocolate for home use via the velvetiser sachets and Hot chocolate and ice cream in stores- all ok.
But what will drive this company back upto £5? Enter the snack bar mass market?? I doubt they could compete on price with Mondalez etc and I very much doubt they have the advertising budget of the bigger rivals.
Maybe its time for Angus to enter the magical world of Wonka and start a chocolate factory tour via the golden ticket... otherwise I see a buyout at some point by the Americans.
One final point- shareholders are not rewarded in any way for our loyalty- about time we got a voucher to use in store!
Chocs Away!
Went to the glasow shop Monday, it seemed the Cafe model is proving popular. We'll see if that turns into a profitable exercise.
Slightly unfair comment on the Japanese expansion. It was covid restrictions that buggered them there. Japan is only just re opening properly now!
In the last set of results, it was stated that revenues through the tills (so I guess incl. VAT) was £1m per store per annum ON AVERAGE. This is one hell of a combined performance if it is true. It is approaching £3k per day for every store, and must be at least 20% of the stock they hold at any one time. Is this plausible or have I got my decimal point in the wrong place.