Member Info for BrokeNSmoke

Smokey – Share price goes down and its panic all round and let’s be fair the donkey is purposely spreading fear with claims of it going bust and get out while you can.

I get why people are fearing, a few people here have been crushed with this stock and are reaching capitulation. Honestly being in that position is brutal, so I get it.

Poker did a decent job of explaining the FCF the other day and showing that FCF is after interest payments, and it is only the hybrid which is deducted post-FCF due to it being classed as equity rather than debt. There is room in the FCF for debt repayments to double and still have free cash to repay debt providing management aren’t using that cash for dividends or further growth investments.

Also, I believe the debt is already a mix of percentages (I recall reading it in the update but cant find it now) so it doubling is unrealistic and overly conservative.

Agreed, a Cosmen buy and 2 tiny director buys (there was one in May too) can only be positive.

Regardless - GLA

My take is wait until the UK CPI data tomorrow and then the narrative from the BoE. The consensus is 2%. If it hits the 2% then there's a fair chance we will see a interest rate drop in the next few month which should positively rerate here. Likely undo some of the damage the US CPI and Fed narrative caused.

I read the cost plus model being bandied about but there is always a danger using this that you are just not pricing in line with market expectations, especially if your plum of a CEO agrees massive future wage increases whilst official data shows inflation under control. Not saying you're wrong or anything, it just can be very nuanced.

What a pathetic attempt to spin this to being a negative.

JC - Thank you for articulating the fears in a rational manner here. I understand why holders are feeling burned my all the missteps management have made, and that they have held firm on their growth plan when they should have been more financially conservative considering the macro events. My original post was to calm down on all the posting that it is going bankrupt, which it isn’t. There are plenty areas where they can cut cash if they really need to tighten their belts on the cash front. While I disagree with pursuing growth into an ever-declining macro environment, that they have the cash inflow to spare should give holders at least some confidence that they have a reasonable buffer before things get bad?

I’m happy to admit if I am wrong or have missed something, but I just cant see cash being an issue.

Personally, I saw many of my small caps drop over the last couple of days, which was preceded by an increase in short interest. I suspect this is all to do with the Fed’s decision to cut down to 1 rate drop this year from 3 and that they got wind of it early.

The only thing that has materially changed over the last month is the election announcement, which JC has articulated the negativity surrounding it. That said, I don’t think labour are quite at the levels of socialism yet where the commissars will roll in and commandeer the trains. I would highly suspect it would start as a sovereign wealth fund.

There are clearly shorters on here considering the amount of spam posts we’ve had peddling fear which we didn’t have before the short interest came along. You see that on many boards when the short interest increases.

If any of you longs are seriously this negative on the stock then why not cut your losses and go? Personally, I am going to continue to keep my emotions out of it and continue to review it based on its financials/fundamentals.

My god, can the fear mongers who keep peddling the notion this is going bust give it a rest please. Positive cash flow businesses don't go bust due to negative market sentiment.

Yes, I agree Garat is a plum and should be replaced. Yes I agree it is being mismanaged. Yes coach USA going into liquidation will likely hurt our NA asset sales. Yes, the company not communicating with shareholders is a problem. Yes there is a big debt pile. This business isn't going bankrupt though.....

Feel free to change my mind, but please do some with financial facts

Even if/when this does happen we don't know it will be nil, just under the 0.5% reporting threshold

Gentlemen/Ladies – What is the mass fear here? We know the company isn’t going bust with the positive FCF and cash being king and all that. Yes, this continued decline of our wealth really sucks but we aren’t going bankrupt. Seems to have been a bit of a red day in the FTSE so hardly surprising we are down too.

Anyone have any idea when the FTSE 250 sell off will be done?

'But then again I am constantly wrong'

God I feel that, especially when it comes to this share!

I suppose the lowest price they would take all depends on whether leadership truly believe that S4 does have a good future ahead of it or not.

Reuters article - UK firms' wage growth expectations fall sharply, BoE survey shows

Sure glad we committed to that 20% future pay rise...

I don't agree with this analysis that Mobico could go out of business soon. Even during these past 2 difficult years we have had a decent positive FCF. It is just not an attractive investment right now.

Goose - 'Highly disappointing, but it is asset rich and awash with cash. Some small tweaks and this could be a very quick turnaround'

What makes you guys think this is asset rich? There's a ton of debt and a big chunk of the assets are intangibles?

When I posted the other day that the bonus plan was a disgrace and there should be a shareholder revolt - I didn't think we would actually get one!

We can all only speculate, but to me it does appear to be Frasers bringing the board to heel.

I agree, commuters hate buses. What they hate more though is no buses. Go northeast caused havoc for all kinds of communities in their massive strike earlier this year.

'Part of the fabric of society which is increasingly important,with the mode of transport so eco friendly and cheap.'

Agree with the first part, but they are hardly bloody cheap these days, even in comparison to running a small car.

Ok good. I thought that was the case yesterday when you posted and I very much agreed with you, however the recent posts sounded as if you were defending it.

BDF – This really doesn’t make the situation any better. It is still an extortionate amount considering the extremely p*ss poor performance over the last few years. Honestly, shareholders should be looking to ditch John Lyttle not rewarding the 3 years of managed decline.

I have no idea of what the agendas are of the trolls here, but they are right on this front. It stinks of directors enriching themselves over the mandate of maximizing shareholder wealth.

It will be interesting to see if Frasers react given the large position they have in the stock.

Jeremy, personally I think it's disgusting. It's a slap in the face to shareholders, especially John Lyttle getting the shares considering he's never bought and destroyed the share price.

I very much hope there is a shareholder revolt over this, although I doubt it will happen.

I think I will probably exit this position next time it goes into the high 30s, I don't trust the management team at all and I actively think that they are increasing their own largesse at our cost.

I wish you all the holders here good luck. I hope it turns out better than the value trap it was for me.

I think this stock will

I have no experience here so may be talking out of my a** here, but I could see one hurdle being that they would have to report their financials to US GAAP rather than IFRS as required to be UK publicly listed, including comparative years. Quite a bit of work there and may not have the knowledge readily inhouse as the accountants are likely trained to IFRS.

Once that's done, I can imagine its just paying a broker a fee?

Agree with Peaky

This has been known for ages. No one cares; when it is out of sight, it is out of mind. Apple's factory suicide nets never became an issue, neither did Nike's sweatshops. They both went from strength to strength. Also I'm not cherry picking, I'm struggling to think of a company that has poor working practises in cheaper economies and has suffered from it financially. I'm old enough to remember the big Nestle boycott... it hardly slowed them down.

Any case, ramble over. My point is this isn't going to affect Shein with its consumer base. Baring any geo-political crises, there is little to stop Shein crushing it in the fast fashion market.

SCB - I get that but we don't know the full reasoning. His risk analysis could be along the lines of 65% recovery and will net a substantial return, 35% chance on loss and will warrant buying out when it gets into trouble for example.

I'm not trying to be a Debbie downer here on an RNS which is overall positive, just tempering expectations. He is ofc a much better businessman than any of us, but that doesn't mean he's an infallible business god which appears to be the sentiment. There are many examples were it hasn't worked out.