The question is, does this new story change anything for the company long term? Okay, the problems persist but it's not BOO this time clearly an issue with the supplier. Can they be banned from trading in the US due to this? Probably not. Will people stop shopping on Boohoo due to this, again probably not. If the earnings keep growing, who cares about the bad press?!
The real concern for me is Shein. They have terrible reviews though, so probably the quality is bad. Not sure about delivery times as well. I think they ship a lot of stuff from China so you might have to wait a long time which is not really the idea with fast fashion. I've just put a random summer t-shirt in the bag on their app and attempted checkout - it will arrive on 14th of August. Summer's almost over by then. Actually looking through the window it's probably over already, rubbish weather really, but that's a different topic.
I can see the media going absolutely bonkers if they start buybacks right now so probably won't happen. Next year though, who knows? Won't be surprised if someone attempts a takeover as well. This is stupid cheap.
I was told by someone who used to work at Next when they were younger that Next have their summer sale now. Apparently it’s almost as big as Boxing Day, definitely their second busiest period. Next are supposedly even hiring temp staff for about 6 weeks from the start of July. So it might be that Next always have these strong summer numbers. I haven't followed them for a long time.
One thing that jumped out at me while reading the Next update is that they are reporting stronger numbers because of increased sales over the last few weeks due to good weather since the end of May. Now our management made an excuse for weaker sales last few weeks because of bad weather.
Clearly someone is not telling the truth and I'm pretty sure it's our guys. Not sure where the ASOS management reside but here in London we've had a pretty good summer so far! Has someone done any digging to see what's the real reason behind the weaker numbers?
You know it's a bad day when Berkshire Hathaway is down 2%! I use it instead of cash, as it's quite stable or going up usually. Last few days I've been selling Berkshire and buying the UK stocks hand over fist but now I'm out of ammo. If I had any cash/BRK shares left left I'd be buying TW here but unfortunately I'll probably miss the boat waiting for my pay check. Happy for the folks who managed to top up!
I've added some shares today. Was mostly buying ASOS due to the bigger drop but didn't want to miss the opportunity here as well.
A competitor had couple of bad weeks, stock drops 5%?? It just doesn't make any sense, especially if you're a long term investor. It's worth mentioning that ASOS hit 26% annual growth which is close to what BOO has guided (25% I believe). So everything is going according to plan, assuming that they match ASOS and BOO still might outperform.
I hope this stays low so I can buy more but I doubt it.
Crazy overreaction, IMO. Personally, I've bought a lot more today. Normally, I aim for a 10% allocation per stock but now I'm at 13% here after averaging down.
Feeling quite comfortable about it. They hit my growth target for the year. Few bad weeks due to seasonality mean nothing to me. If you're a fund manager and are judged quarterly that might be a big deal of course, thus the sell off. Let's see how the ASC numbers look in 6 months or so.
On a more negative note, I do agree that the insider sell right before a piece of negative news is bad optics. Perhaps he didn't think it was bad news and just the market perceives it that way? Personally, when I read the RNS in the morning my thoughts were "Oh good, everything is going as I expected". I couldn't believe my luck when I saw that the share price is down 14%. Christmas came early this year!
I don't understand the manipulation comments on here. We had a piece of negative news with the US lawsuit and the share price fell. It kind of makes sense, doesn't it?!
If you're a fund manager and you're judged quarterly, are you going to hold BOO and risk that it keeps going down or stays flat for several months due to the lawsuit? By the time the lawsuit clears and the share price recovers you'll be out of a job!
Us little guys don't care about this, no one checks our performance. We can just buy more shares on the cheap and sit and wait. That's actually our main advantage over the professionals. But it's perfectly logical for others to be selling. I for one am grateful for it, as it's my chance to outperform!
To those who are tired of waiting look at what happened with Morrisons. One year the share price was flat and now it's up 50% in a week. If there's value and earnings the share price will follow sooner or later, one way or another!
Yes, I've topped up as well. It took me months to build my position but luckily for me the stock stayed low long enough. Now I just need to sit and wait for the TW update to come out in the next one month.
I'm no macro expert but my thinking here is that rates can't really go much higher than 5%. The UK's budget for 2021-2022 is I think £1,053 billion. Of that £45 billion is debt interest payments or about 4%. Obviously that's not all paid at the current 0.1% rate or it will be much lower.
The current national debt is £2,131 billion. I don't know the exact structure of the national debt and when it comes due, I think they roll it over in bits, etc. However, if we assume that long term interest rates go back up to 5% which is what we had before 2008 and the all debt gets rolled over at that rate things look pretty ugly for our government. £2,131 * 0.05 = £107 billion. That would be 10% of the national budget. Certainly we won't go bust but unless we get hyperinflation I don't see why the UK government would do this to themselves. They will probably try to go up to half that or 2.5% which will match their current payments. And IMO it won't happen any time soon.
In this bear case scenario of course the HBs will take a hit but people shouldn't really lose their homes. I believe most banks do check that people can afford their mortgage in case they are moved to the standard variable rates. For that I think right now they assume 4.8%. So most home owners can afford a 5% rate. Of course the standard variable rates will be higher in case we have 2.5% interest rates I think they are 3.49% above the BOE rates. So they might get up to 6%, slightly higher than 5% but I don't see many people losing their homes.
Strictly, thanks for that. Super helpful. I feel with investing one has to look past the narrative and dig into the numbers and that chart does exactly that.
It also confirms my suspicion that house prices have been suppressed since the Brexit vote. If you look at the chart they were in trend before 2016 and since then they have been below trend. With Brexit now done and dusted, Covid hopefully being less of a problem and people's savings account having grown during lockdown I think the housing market might stay white hot for a little longer than people expect.
People have been posting about sub 300 for months and clearly they've been wrong. That doesn't mean it won't happen but if those comments were based on TA, the charts were quite wrong.
Also, if you're short/bearish the stock I think you can do a lot better than just saying "this is going down to 280". That adds zero value to the conversation. How did you reach that conclusion? Technicals, fundamentals? Otherwise, people will just add you to their filters and no one is going to read your posts.
It does seem like a case of diworsification as per Peter Lynch. I don't know if the products are any good, will get the missus to try them. I might order the men's shower gel haha.
I agree though, it's a bit of a leap going from chocolate to cosmetics. If they had 3-4 really high quality products that all contain cacao that might have worked but they have done a whole range of stuff and a lot of it has nothing to do with cacao. Salt & Lemongrass Body Scrub... Why would anyone buy that from HOTC and not from the Body Shop?!
Share buybacks are an option as well. There are plenty of companies that do both buybacks and dividends. I'm normally not a fan of buybacks, as most CEO decide to do that when they have too much money which usually coincides with market tops. In other words they overpay for the shares and destroy shareholder value.
In TW's current situation though, I feel the company is trading well below intrinsic value and buybacks would be good for shareholders. Might be bad optics politically though in light of the cladding scandal. I can already see the Guardian title - 'Property tycoons splash out on buybacks, cladding victims misery continues'.