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Simar: 'Ocado tech is in the CFCs not the spokes....'
This is now a critical point IMV: Are OCDO's CFC's a proven game changer for retailers that use the technology?
Some on this board play down the importance of the Retail JV but, in reality, isn't it the model upon which sales of the technology depend?
Is the Retail JV adequately demonstrating the potential of OCDO's Technology and providing a convincing case for potential clients to invest in it?
Failure of support at 450 after the Easter break, was my cue to exit before 432 was seriously tested. It got pushed to 430 but finally gave way today and a new bottom will ultimately be found, with the gap fill to 386.6, from last June, now looking rather inevitable: https://invst.ly/149ndd
OCDO’s sp is also now back to early 2018 price levels which, after six years, begs the question: ‘ Which aspects of the business are mainly responsible for the lack of adequate cash generation: Retail, Technology or Group Management?
Here's a reminder of how Shel and Brent have tracked each other since last October: https://invst.ly/149b6k
It's worth noting that, in charts like this, the Brent line is based on the daily closing price which occurs a few hours later than the LSE market close at 4.30pm - so they are not exactly in sync and, this morning, OP has slipped back a little since yesterday's LSE close. This 15 minute chart of OP v Oil Co's gives a more precise picture of the moves (the price scale is approximate): https://invst.ly/149be1
I agree Pokerchips - it's just harder to lose money on a share that's progressively moving up because whatever price you acquire at it'll end up higher at some point. With OCDO that's only been true during certain periods. I'm not especially bothered about buying at the bottom - it's a bonus if it happens.
Meanwhile the day ended a lot better than the first couple of hours were looking. OCDO has a number of negative trends to break through and, just maybe, it'll start tackling them from here. Holding onto 432 would be a start as there's a bit of a void below: https://invst.ly/148zp3
Phoenixy: Yes, it's putting up a fight to hold onto 432 - rescued by a rally around 10.30. If it's still above this support level at the end of the week then you may well be proved correct about the bottom. https://invst.ly/148rg7
msuk: I'm obviously not a trader but, if I was, I think I'd find it much easier/more profitable to trade shares that are on a longer term uptrend. OCDO currently strikes me as hard work for traders and LT investors alike.
GL to both of you.
Yes indeed msuk. Are you still following it ? Yesterday's drop through 450 took me out for the time being. I think today's fall might trigger stop-losses and so there's a risk of the fall accelerating . It's also now too close to the gap at 386.6 for me. The upside is not looking too great on the fundamentals either. It's the end of the financial year and OCDO has been a net positive for me over the period, so a neat point for me to exit.
Looking at all the trends in play, infor, what is your basis for disputing stupmy’s conclusion about the most likely price direction? On March 4th the sp fell to the current level but recovered in anticipation of the trading statement. However it has now fallen back to the same 432 support level, with the red trend here having broken every positive trend (green) it has encountered this year:
https://invst.ly/148dec
With no dividends and a lot of unknowns for investors, what are the main factors driving your optimism for the sp to build from here?
52-week high of 2,801.00, set on Oct 18, 2023......
Yeah -this chart happens to show the falling red trend starting at that intra-day high: https://invst.ly/147tx7
It's certainly a target for me, although anything above 2750 has proven to be pretty fragile so far! GLA!
I'd personally prefer less conflict in the world and a stable, sustainable OP but, hey-ho, the reality of humanity is chaotic at best and barbaric at worst. Yes Brent looking good trend-wise: https://invst.ly/147tlo and, TBF, $87 is at the upper edge of its 'normal' price range (if there is such a thing) rether than hitting an extreme.
Yes - it's 'year on year' - so achieved over a period of 12 months, not 'during its first quarter' as the retail gazette article states. Do you guys not understand the word 'during' ?
Thanks for confirming my point.
The article says the rise occurred during the quarter - but, as you say, it is a year on year increase so it occurred over a twelve month period - ie between the end of Q1 2023 (measurement 1) and the end of Q1 2024 (Measurement 2) it did not happen during a single quarter. It is the word 'during' that is misleading. Also. by using the word 'surge' it reinforces the false impression of a rapid rise over three months (ie between two adjacent quarters), when, in fact, it was an increase over a year which was presumably largely driven by inflation rather than business performance. I'm not suggesting that OCDO's performance has been bad but neither has it been an outstanding 'surge' as the wording of the article implies.
‘The news comes after Ocado reported a 10.6% surge in sales during its first quarter…’
I find this bit of the retail gazette article misleading: A 10.6% increase in the first quarter would indeed be a surge but it’s a year on year figure for the first quarter - so less than 1% per month averaged over 12 months. That’s not ‘a surge’ in my book. If it was a comparison with Q4 2023 , as the wording implies, then that would indeed be impressive.
Cheers Casapinos, I appreciate your response to my comments. However, I do disagree that the retail JV’s prime purpose isn’t to make a profit: It is a fully fledged operation - not a tech test model, so if it isn’t profitable then it demonstrates that the technology doesn’t generate sufficient cost benefit to justify buying it. Also, on a factual point, I believe the revenue and customer numbers you quote are those of the full JV not just the M&S portion. But I stand to be corrected on that.
Meanwhile, the sp is today struggling to test 470 let alone 500 and the most positive upward (green) trend now looks like this: https://invst.ly/1463u- . Hopefully support at 450 stays intact but I’m guessing quite a few stop losses may be set just below 432.
I recommend the debate (Waccy, VP and Phoenixy) in the ‘why underperformance matters’ thread.
As waccy points out, this is a heavily sentiment influenced stock but, as Valueplay says, the fundamentals currently look rather weak. For me, OCDO remains a total punt - and the charts just help me gauge how the market is moving, which for the last fortnight has been along a tightrope.
In the absence of news on either JV negotiation with M&S or the tech front, I assume the next key fundamental influence could be the M&S Prelim results on May 22nd.
Casapinos: ‘Ocado retail is a full-scale demonstrator for the real product which is OCDO tech solutions. Its primary purpose isn't to make money’.....
Try telling that to M&S!!
The Trading JV is supposed to be a profitable business in its own right and also demonstrate that the technology enables similar businesses to be sufficiently profitable to justify investment in OCDO's technology.
I’m glad many of you are happy with this statement and that some think it’s extremely good. I hope you are right.
I’ve found it sobering to compare the market reaction with this point 12 months ago, after the 2023 Retail Update. https://invst.ly/145bya .A year on and the sp today is very comparable with then, so the market hasn’t yet seen any material increase in the Group value since then despite resolution of the Autostore dispute and a year of improvement in the JV Performance. In April 2023 the sp briefly rose from 478 on statement day to around 560 before eventually sinking to the year’s low at 342 in early June. I hope things go better this time around - the charts will provide the true picture without any vague words of praise and hype. Does this performance merit an improved bonus package for senior management? Our votes count apparently.
BTW: For those that missed it, Valueplay posted before 8am with a quick and useful analysis.
Ha! I've become a bit absorbed elsewhere getafgrip. But Shel has been doing great for me - I'm still 'overweight' in Shel despite recently disposing of two out of three trading tranches I acquired near the bottom. My target for the last of those is around 2750. After that I will only start selling tranches of my core holding if I'm convinced I'm seeing a pull back from a significant high. My O&G 'failure' has been BP, although I've made a reasonable profit on two out of three tranches there and I'm breaking even on the third but I'd have done much better with Shel. I should have known better, I guess. ATB.
I do agree, Pokerchips. It's about getting the balance right and, TBH, there probably isn't a formula that would please everyone.
However, if he needs the carrot of an enhanced bonus it implies he either hasn't been doing his best up to now - or that he deserves more for continuing at the standard he's been achieving . So it boils down to whether the voters at the AGM think he's doing a great job and meeting their expectations (which should have been based on his guidance over the years). Reading some of the posts here I detect an increasing level of dissatisfaction = which suggests many will view the revised bonus as a reward for underachievement. I've been fairly neutral up until recently because I thought that the wild sp swings were purely down to investor overoptimism but I'm starting to feel there have been strategic errors as well.
At least it's up for a vote.
It’ll be interesting to see when OP does break the red trend here: https://invst.ly/144pd4
For Brent, the price region around $87 has been a potential ceiling since 2018, when it marked the onset of US shale overproduction and the crash in price that resulted. Things have changed since then but global events have, as they always will, disrupted the natural demand/supply balance that OPEC+ seeks to optimise and control. Once the price rises above $90 it usually triggers a sharp increase in production somewhere (the US would almost certainly be one area to react) which tends to put a lid on it.