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Note - the Pret Index is baselined to Jan 2020 and so does not mean 70% of a comparable pre covid month (this would have the most significant bias for UK airports which peak in the summer).
I have calculated the US TSA numbers on a rolling two week average so this is directly comparable to the pre covid data.
I have been following both the TSA Checkpoint numbers and Bloomberg's Pret Index as proxies for Smiths. TSA (US airports) has been holding up at around 80% of 2019 figures for several months, the Pret Index has been creeping up from 70% to nearly 80% now for London Stations. The laggard had been the UK Airports but these have now reached over 70% on the Pret index.
Hospitals (oddly part of travel) should have continued to do well with more routine work now being undertaken. It is usually a quieter quarter for High-street but again no reason to expect this to be much different from the past quarter.
Year end is next week so I think (hope?) trading may look better than some believe.
So many holiday destination of significance have Brits either forced to quarantine or banned. This will only get worse for us with massively rising cases here and only 1 in 3 adults across most European destinations being vaccinated. America and other countries - no chance.
What on earth is holding up this sp!?
Totally agree there's nothing to warrant this price and will be brought back down to £15 and lower
Who buys this stock it is over priced I would like to see the balance sheet plus like for like sales this stock price kept up by the British establishment
I said it was going and £15 is where its going
now comes the big sell off I told you £15.00 here we come
No reason for the rise and with bad news on the way down it will go back to £15 and below
Tell why this stock so high it sells nothing where does it makes its profit from
Another good day seen as all FTSE indexes down today. Hopefully there is more to come. Good Luck all.
Another big rise today :) Exiting times ahead as the vaccinations kick in.
Good luck to all invested :)
"Stupid Stupid investors" "Trading is worse than dire and share price goes up 10%"
Price has gone up because of the better than expected trading update results released today. I am a very happy stupid investor :)
Bonkers - non-sensical market response. Trading is worse than dire and share price goes up 10%. Stupid Stupid investors. The stock market is completely non-sensical!
I hold a few, not too many.
Decent stock however.
Not to everybody’s liking.
Will add when opportunity arises.
GLA / DYOR always
These are a buy at 930.
This all seems very positive: https://www.moodiedavittreport.com/on-location-whsmith-reveals-next-generation-blended-essentials-store-concept-at-london-heathrow-terminal-2/
We have had peak holiday season and airports were dead. Summer holidays over, kids back at school. A very quiet winter ahead, with a looming second wave, including further travel restrictions. France are about to quarantine UK; Greece looking dodgy...
Footfall is still dire in airports. Inevitable spike in COVID cases over winter with governments panicking and locking down countries will also deter travel. This is a business with serious issues and needs re-rating . I might be in under £5.
Goldman Sachs initiated coverage of WHSmith at 'buy' with a 1,500 price target as it said the stock offers industry-leading returns at a discount.
"Our positive view is based on a gradual improvement in traffic (across air, rail and UK high street) and a constructive long-term view on profitability, resulting in a strong returns forecast versus peers, which we reflect in our multiples-based valuation framework," it said.
Goldman expects travel sales growth to outpace High Street sales growth and anticipates a circa 10 percentage point top-line substitution over the next four years. "Hence we expect a shift away from a competitive high street towards a more captive customer in travel, driving long-term upside to already best-in-class profitability," it said.
The bank said that on its estimates, these returns are not captured in current valuations.
In the near term, Goldman reckons the company is close to the bottom of its earnings revision cycle post the Covid impact, and said it sees potential consensus upgrades as a positive catalyst for the share price.
"Our upside versus consensus is mostly due to our view on margins, which we see as supported by: (1) an improving product category mix driving upside to gross profit margins across both travel and High Street; and (2) a reduction in rental costs on the High Street given lower footfall - both of which we estimate could add up to 130 basis points of EBIT margin upside over a four-year period."
Can only see Smiths going down further. High Street footfall down 40% in July. Many travel stores still shut or seeing a fraction of the footfall, Smiths is too exposed to the travel downturn. Set to make a £75m loss for the year to August. I don't see things improving in the next 6 months. Have added to my short position. Long term investors I would advise against topping up now, wait until this hits 650ish in November wait until redundancies & store closures have begun.
Only a tiny fraction of people flying now. Footfall must have been decimated and future holidays risk being cancelled at the drop of a hat. Makes me wonder where this business I heading. Winter could be crunch time. Let's hope the virus is almost burnt out by Xmas.
Agree. The share price for WH Smiths is disproportionately undervalued. With travel opening up, not just airports but train stations and high streets, I'm surprised this has dropped so low.
Top up time approaches
Roguemale - let me explain. Being stuck for 3 hours there and back on a plane near sneezing idiots greatly increases the chance of catching virus. Being in a hotel with God knows who greatly increases the chance of catching virus. Queues, toilets, buffets, cafes, hiring a car, getting on a bus and pinch points at crowded airports greatly increases the chance of catching virus. Yep, they would be Fools as you rightly say. Staying at home, however, doing your normal safe routine greatly reduces the chance of catching virus.
PMSL
Absolutely Doug.
Just think.
All those less intelligent people having a couple of weeks in say Europe in a country with less Covid than the UK....
Fools one and all!!
PMSL.