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The charts (to me) show a very clear rising Chanel from 18 jan to now with a whole series of higher highs and higher lows. Several touches on the bottom Chanel and top defined by 28/1 + 16/2 reversals. There is significant resistance 32 to 35 where the 50 day MA sits but I’m staying in to hopefully break through it.
This level was a minor blip when it broke through in November and significant support at the end of December so a key level to me.
This latest run started 18/19/22 Feb with a classic morning star and big green candle indicating strong reversal and as keep bouncing back from resistance less each time so I’m staying in it to win it myself! Hoping for a breakthrough this week but we all know how difficult telling the future is!
Was an odd day. But very interesting that we get a quick pullback at this level after a fantastic rise yesterday! So far this is a carbon copy of the last rise out of the depths on 9th November. History does not necessarily repeat itself.. but if it rhymes with the past we will be in for a 14% rise tomorrow.
Well done to those who held their nerve today and believe in owning part of a great business, let’s hope for a repeat of history tomorrow ;-)
We all expected an RNS on 3rd December as happened last year! In 2018 the RNS reporting strong trading was on 17th December! Tomorrow feels like a good time for an update!
If anybody remembers the press conference following results, there was lots of questions about why the inventory levels were so high which was met with rye smiles. I think we all know why all the warehouses are full to the brim.
Hi folks, I have been hanging around here on the shadows for some time now. I have wanted to take a decent slice of JOG as I read about it the last couple of months. I got in a little on the lows and loaded on the way up today.
Can I get an idea of a target price that many of you might hope for please? Let’s say wti is ranging $50- $60 and Covid less of a worry. Also, a poll on timeframe. Are we thinking the best opportunities will be 2021 or beyond?
And I very much appreciate the time that the key players spend sharing their knowledge on here for the benefit of others like me. You know who you are. Thank you.
This is interesting. Really interesting! The graphics show a spaceship on a journey through a burning desert and into a thriving future city! Then the road turns up 90 degrees exactly like in the film inception! Inception!!! In the movie was entering somebody’s head and planting dreams! The final city in the animation is thriving with lots of Boohoo ads on the skyscrapers! Nice find share expert! Could this be a clue?
The BIG 5 Numbers
There are lots of ways to analyse and believe me it takes a lot of time and effort to get it all done. I recommend you read a book called Rule 1 investing by Phil Town and listen to his podcasts about checklists. (Buffet Style Investing).
There is a great way to do an initial assessment on a company to evaluate the quality of the business and the management and that is what Phil Town calls the big 5 numbers. All of these should be above 10% as a rule. It is virtually impossible to find companies that hit the figures at present, but BOO exceeds in all 5 areas (at time of my initial analysis a few months back). Rates here are averaged over 5 years!
Return on Invested Capital (ROIC) 21.5%. (how much money it can make with the money it has)
Sales Growth Rate 45%
Earnings per share Growth Rate 26.7%
Book to Share Growth Rate 26.6 %
Free Cash Growth Rate 35%.
This as always, is intended for open debate. I will never tell anybody right or wrong because it doesn’t exist in this game. But you can load the dice in your favour to buy amazing business at a discounted price which is where I believe we are right now. https://www.ruleoneinvesting.com/blog/how-to-invest/the_big_five_na/
I posted that late on a Sunday so many will have missed the thread. Thanks for re-posting, it’s nice to read it back at a time like this when we feel all feel the emotions of day to day investing. There are lots of books recommending the method so I try to roll with it and keep faith in the numbers! Interestingly I just finished a book on another subject of behavioural Investing and the final chapter steered back to this as the most effective form of investing when it came to beating the market! Studies also showed that the really outstanding investors investigated either forgotten about their shares or were dead! ??. I know it’s not easy but stay calm and stop watching the candles is the best strategy!!!(I wish I could follow it)
Wyndrum, valid point but the amount of cash that BOO has an effect on how much weight you put to PE ratio. This very subject was covered really well in an article back in Jan.
https://simplywall.st/news/despite-its-high-p-e-ratio-is-boohoo-group-plc-lonboo-still-undervalued/
The question for all is whether you think growth will continue?? I think its undervalued.
Just a note about trading out of the triangle that formed and wound itself tighter and tighter until it broke on Monday. generally the break will be equal to the height at the start of the formed triangle (end of August)- 317 - 276 = 41 difference. As this broke from around 297 then the expected breakout is to 338 by close on Friday. I did load the truck at 295.
https://forextraininggroup.com/how-to-trade-triangle-chart-patterns-like-a-pro
I think it is worthwhile in terms of BOO to step back from watching the graph go up and down on an hourly, daily or weekly basis and look at what is likely in the longer term. The very recent chaos is now just a blip on the horizon for us all unless you panicked and the big drop was incredible opportunity that got many of us in. Be fearful when others are greedy and greedy when others are fearful. Look at the fundamentals and stay calm.
Estimate of the Intrinsic value price of a Boohoo Share.
1) 5 year EPS growth rate estimate from yahoo finance (analysis page) is 29.9% per year. From the balance sheet we can see that equity has grown from 85.5million in 2015 to 569 million in 2020. That is 46% per year compounded growth.
2) The 5yr historic PE from MSN Money price ratios is High of 70.86 and low of 37.69 is 52.7 average.
3) Current EPS (TTM) is 5.3p x growth rate 1.3 x 10yrs = 69. Therefore the estimated EPS is 69p in 10yrs.
4) The earnings per share of 0.69 x the future PE of 52.7 gives a share value in 10yrs of £35.88.
5) If you take 15% profits year on year from this sum you achieve a current fair price of £7.71
6) discount this by 50% for a margin of safety purchase price of £3.85. Basically you can buy this all the way up to £3.85 and still get a fantastic bargain.
I have run this calculation on a multitude of companies, and none meet the criteria. If you can find any companies with a solid history of exceptional trading like Boohoo that have lost substantial value through no real fault then please let me know of them.
The calculation method I use is as follows;
1) Work out the expected future earnings per share (EPS) growth rate of the company
This is based on either the annalist's evaluations on say, yahoo finance for 5yr growth, or on previous year's performance based on equity growth, whichever number is the most conservative.
2) Work out the future Price to Earnings ratio (PE)
This is taken as either the average of previous 5yr high and 5yr low. Or double the growth rate, whichever number is most conservative.
3) Estimate what the Earnings per Share will be in 10yrs time.
Take current earnings per share and multiply by the EPS growth rate and number of years (say, 10). This will give the estimated EPS in 10 yrs.
4) Calculate the share value in 10yrs time
This is basically the estimated future Earnings per share x the estimated future PE value.
5) Discount to find todays Fair value for the share.
Discount this estimated share value back to the current day but take your required annual profits required out each year. (say, at 15%)
6 Reduce the sum to have a margin of safety I think 50% is acceptable.
This is because we know that everything may not go as planned. This is basically the maximum we are willing to pay per share as a new owner of the company.
I am interested to know if anybody here is a value investor. I follow the Buffet style Investing as best i can which is really difficult because there are virtually no companies that meet the criteria at present. In fact, Boohoo is the only business that I can find. Has anybody on here worked out a number for the intrinsic value that they can share. For clarity, Buffet and Monger calculate the amount of cash that owners (us) can take out of a business and then discounts that back to find a fair current day value of the stock and then look to buy with a margin of safety.
Jimmy, I agree that the bottom line of the trend is 295 and this is also the level of lots of recent support. I think we would all feel that a close below 295 is not good news but i feel that would be against all sentiment and expectations in the market.
I like trading patterns as they have served me well. Does anybody else have an opinion on this?
There is a very narrow range formed as the tip of a triangle that has formed very clearly since beginning of September. Also this forms back to the beginning of August and is even evident back to the beginning of July. The range is so tight now that a close above 300 is probably enough to break the trend line to the upside. breaking the trend line will bring substantial momentum in my opinion so i am more bullish than ever.
Without Chris to send us all the news we must dig it out ourselves. Not sure this was posted. Can we keep the conversation all about BOO please. Nothing new here but across the board we are seeing Trading tipsters beginning to tip BOO. Another rally must be due soon. Sideways is getting boring........
Motley...
Interim numbers are due on 30 September. I suspect another big move is on the cards. If recent sales momentum has been maintained, this should be in an upwards direction.
Back in June, the company reported “very strong trading and operational performance“. Despite the coronavirus crisis, it now expected to beat previous market expectations for the full-year.
On the other hand, accusations of poor pay and working conditions in factories supplying clothes to the company have dented BOO’s reputation. An independent review is in progress but it’s clear investors will be looking for an update on what steps it has taken to rectify things. The share price could be punished again if this is deemed insufficient.
https://www.fool.co.uk/investing/2020/08/27/heres-why-cineworld-and-boohoo-are-the-uk-shares-to-watch-in-september/
Pmoran. ‘When it’s raining gold go outside with a bucket and not a thimble’ ...I think it’s risky as you say to load up! I bought in with 25% of my pot! It went up and I loaded in again and a third time. I now have 26% profit average! That feels like a safe way to enter with a big buffer against making a loss. That makes sleeping easier......If it dropped 25% Monday would I get out? No! I’d reduce and start again. I spent weeks studying the company and the numbers really do stack up!