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"such as the new Hatfield site etc"
sorry ..I mean the Luton site
Valueplay
part of the fund raise is to fund their own CFCs for Ocado Retail such as the new Hatfield site etc ..plus R&D ..for the advancements of the technology of course
Valueplay
I would be interested to clarify the issue of CFC Customers ....
The books have Contract liabilities of £446.7m (FY22: £422.9m) which is stated as
" primarily relate to the consideration received in advance from Technology Solutions and OIA customers."
" Revenue is recognised when the performance obligation is satisfied, typically when a site goes live or OIA products and services are provided. "
so...my understanding .....rightly or wrongly from the wording of "received in advance" indicates that the customers pay Ocado in advance , but it is a liability until Ocado actually achieves the obligation
Ocado have spent cash to achieve the "performance obligation" which is shown as CAPEX spend .....but... they dont remove the liability from the account and add it to revenue until the site goes live ...
Ocado does invoice for design aspects and that moves off the liabilities and onto revenue when the client shows satisfaction and signs the invoice document
so.... in affect ..Ocado are achieving more than the accounts suggest at this stage .... because the revenues of obligations complete have yet to be received as revenue...on the books
If you look at the RNS for example regarding McKesson Canada ( 15/11/2023) it states " Ocado will receive upfront fees during the construction process with the final payment upon final installation"
Atleast 3 points in a trend line must touch ,sm use bodies sm use wicks ...but that way u will get the best results
Phoenixy: Whilst I think it's found some support there's no evidence of a reversal as yet IMO. Yesterday's candle appears to contain a data error - the day's low is given as 3.48 so I assume the decimal point is in the wrong place for a 348 entry. I think the actual low was 335.
Ah yes, the trend lines on smaller tf are pretty much invalid ,usually use daily and weekly ,smaller tf best to use ema's to trade...
That's a 15 minute chart msuk.
Up in top left next to OCDO, the number 15 gives the TF.
I almost always post either a 15 minute (trading TF) or a conventional daily chart.
#bayo ,what time frame is that chart ?
Exane were spot on Boyo. If you asked them now I'm sure they'd give a more downcast price target than their previous one. Recent results both Ocado group and Ocado retail have been poor. Ocado are now on the verge of a legal battle with M&S. Kroger shutting multiple spokes which is a red flag re future expansion expectations of Ocado infrastructure at Kroger. Yes Kroger are committed to online grocery however they have many partners in this space, Instacart, Shipt etc to carry out this function. The read across is that they will be using Ocado in a less expansive way.
Ocados online delivery model is a high consumer of fuel as they deliver to customers from heavily centralised CFCs
This is a vulnerability when the oil price spikes.
It's a risk off market currently and it's obvious for Ocado to drop further given the extent of issues at the company.
Bayo,
Nice looking chart you share that I always look forward to...Does today cross and close over trend line indicate that the trend may now be reversing ? If not, hopefully seen the bottom today.
As well as Pokerchips' points, CFRA acknowledge in respect of the spoke closures: ‘….these closures are relatively minor in the context of the potential CFC order pipeline…’ their point being that …’ they are perceived as a negative indicator of future performance’ So It’s perception rather than actual performance that is driving their comment. Exane rated OCDO at 390 last September and were much ridiculed on this board. Although Exane don’t look quite so dumb now, it would be equally true to say that the business has made progress since then.
Meanwhile, today was more volatile than yesterday for OCDO but at least it finished above the most recent red trend and effectively on par with yesterday’s high at 350 (the arrow points to the closing UT price ) https://invst.ly/14g5kd . It’s probably going to be a weak period for the sp until the MKS statement in May and the half year results in June but it may yet level out rather than falling back to, or much below, today’s low of 335 (just above the 330 low last seen in December 2017)
In terms of Kruger online and digital..... dont believe everything some people wish to try and tell you..
From Kruger themselves on their Q4 Call transcript - 07th March 2024
"....digital had strong results in 2023, delivering more than $12 billion in sales.
Digital sales grew by 12% on a 52-week basis.
And we improved our cost to serve through increased volume and process enhancements, as well as technology to optimize associate pick routes for more efficient picking.
Digital is an important growth accelerator in our business. And in 2024, we expect to deliver another year of double-digit sales growth.
As we grow volume, particularly in our Kroger delivery network, we expect our unit economics to improve and become a tailwind to our long-term financial model.
We have a clear path to improving our digital margins, closing the gap with our traditional brick-and-mortar business over time.
Kroger is well-positioned through our combination of stores and dedicated fulfilment centers, enabling us to serve all customer trips, including both immediate and next day.
Customers who shop both in-store and online spend three to four times more compared to in-store-only shoppers.
Moving promotions online allowed Kroger to take personalization to a new level, targeting customers more efficiently and increasing the breadth and depth of promotions.
During the fourth quarter, this led to an 18% increase in digitally-engaged households. "
Concerns re slow CFC rollout and the recent Kroger spoke closures (as I have highlighted at length previously) are driving their reduced forecast.
"Ocado shares target trimmed by CFRA amid Technology Solutions concerns"
https://ca.investing.com/news/company-news/ocado-shares-target-trimmed-by-cfra-amid-technology-solutions-concerns-93CH-3353503
"The adjustments come as Ocado's current roll-out of its Customer Fulfilment Centre (CFC) is progressing slower than expected and is unlikely to meet the full-year estimate previously set out by analysts.
Ocado's key partner, Kroger (NYSE:KR), has also shifted its strategy, moving away from the initial goal of a home delivery service. This change in direction has led to the closure of three Ocado-powered spoke facilities. Although these closures are relatively minor in the context of the potential CFC order pipeline, they are perceived as a negative indicator of future performance."