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I'm not sure I agree with that sentiment, as the last few years have been unprecedented and unpredictable. I suspect JL doesn't get to make every decision, as Kamani is the main shareholder. For example, do you think JL hired Molly Mae on such a large contract? I don't.
The CEO and CFO are experienced and in my view are trying to move the business in the right direction.
I’ve no idea how algo trading works, but it strikes me as a way of manipulating the shares of a company in a normal trading environment. It might all go wrong if, for example, a takeover announcement comes out of the blue.
Could it be a skim? Use the algo to push down the SP, then buy back quickly for a fractional percentage gain?
Honestly no idea but price surges at the end of day are not normal. And we’ve seen this three days in a row.
Wolf ... yes. Even Boohoo's USA revenues fell by 11%, the lowest fall of all the regions. The US economy is recovering faster than other regions, with inflationary pressures falling more quickly. The question in my mind is will we see the same pattern in the UK when inflationary pressures recede? And as the world moves out of this economic environment will we eventually see growth in sales, rather than shrinkage?
Notice on my Twitter feed that the fear and greed index is now at "Extreme Fear". No surprise about that as I've been looking at a sea of red these past few weeks.
Puzzling really as we have seen inflation fall and interest rates placed on hold.
A lot of noise also about the collapse of small caps and the AIM index.
Are we nearing capitulation?
The key is to arrest the slump in sales and get back to sales growth. The main positive from yesterday was the improved margins, the main negative the reduced forward guidance on sales … so that’s what needs to be fixed.
I don’t believe shorts closed today. With high interest rates and the cost of living starting to bite the consumer will continue to have a rough time. You’d need to have some blow out results to scare them off. Also, I think that there are many shorters hovering under the disclosure level, so the tracker doesn’t tell the full story.
My best guess is that one or two large buyers came through in the afternoon. I wouldn’t be surprised to see another RNS from Frasers.
We will know soon.
Quite a remarkable close today. The update showed some progress on margins but there’s no getting away from the miss on revenue forecasts and the lower guidance for FY2024.
Perhaps Mike Ashley has been buying again? We will soon find out.
The Times send a morning update pre market to subscribers, touching on some RNS.
Interestingly, they stated EBITDA ... "fell to £31.3m, down from £35.5m last year, but higher than the £23.5m City analysts had forecast".
I wasn't aware of consensus from City analysts ... so despite lower revenues, this looks like a significant beat to expectations ... as it is 33% higher than analyst forecasts.
A miss on revenue, down overall 17%, outside the 10%-15% forecast. Is that also down to poor July/August ... we shall see from the conference call?
Adj EBITDA of 31.3m is lower than the Peel Hunt forecast of £34m, but the margin of 4.3% is in line with forecast, and a positive result.
Guidance going forward lower. Revenues now forecast down 12-17%, not 10-15%.
Guidance going forward lower. Adj EBITDA now forecast £58-£70m, not £69-£78m
US warehouse, stock reduction, etc all positive.
Boohoo have made progress, but not as much as they had forecast.
I read that Sir Paul Marshall of Marshall Wace was one of the bidders for the Telegraph Group. In the same article it said that Ken Griffen of Citadel was contributing to the funding. Hedge funds don’t work independently, they work as a gang. And on a poorly regulated market like AIM they can do what they like. As long as the economy is struggling there is no reason to pull back on @ short.
If I had unlimited resources and borrowed every stock available I could crash the share price, whatever the update. They only clear off when the evidence of a recovery is overwhelming or when the company is taken off the market. And even if we see a positive update they’ll still walk the SP down later … and will only stop when the buying action becomes overwhelming. But when companies in this situation turn, the move is dramatic.
Southcoast - precisely. Not the actions of a company struggling to survive.
I seem to have triggered an avalanche of trolls … with my marginally optimistic outlook? All I see is green boxes, as I’ve no interest in polluting my head with the thoughts of people who spend night and day on here, despite claiming to not have an interest, either short or long.
I suppose we will know tomorrow whether Umar’s purchase was based on any knowledge about trading performance. Another point, seldom mentioned, why would a struggling retailer spend millions on a stake in Revolution Beauty if it were struggling to reach its targets? Most would conserve cash until better times arrive.
I don’t expect great results, but I would hope to see them meet or beat expectations.
The Times - Monday
The Week Ahead column, a few lines on Boohoo update:
“… expected to post another damp set of results …”
I recall similar commentary last time around. Peel Hunt quoted on poor ASOS sales July and August … and reading across to Boohoo. ASOS numbers in the update before last were poorer than expected … but Boohoo were slightly better than expected. So a read across between the two may not be valid.
I suppose if the company are predicting a fall in sales of 10-15% then any improvement on that would be viewed as a success.
Agree PDS … the economic backdrop is still poor, but as every month goes by lower and lower inflation will eventually lead us into a period where interest rates have to fall. Wage rises are already beginning to be in line with inflation so that impacts the consumer positively. A poor Summer impacting sales is not a sustainable trend, and these events go both ways at times, with surprise upsides.
I’m not sure how long it will take but economies eventually turnaround and power forward. Perhaps the end of war in Ukraine will be the catalyst, I don’t know?
Woke up later today and the first thing I read was from an update email that the Times sends out after markets open with the first sentence “… ASOS has warned …” so I expected a severe reaction today.
Clearly poor summer weather has hit sales but improvements in stock levels and profitability have calmed markets. It looks like there strategy is working, and poor weather impacting sales is transitory. So no huge moves today.
Am I right in thinking that the ASOS last update was deemed poor only for Boo’s later update to be better than expected? I’m not sure how connected the two really are but Boo May also have had a bad weather hit … we will soon find out.