The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
It is priced to fail and it was failing. Some here believe that no longer to be the case. Give it a year or two and we’ll see who is right.
As I w said before, I very much welcome comments reflecting the bear case - Simon, Alex etc… raise some legitimate and strong points that certainly should be given the respect and consideration they deserve. This account, on the other hand, adds nothing of value; nothing at all.
Chase your 200p if you wish - good luck, with that one.
DYOR/GLA
Haha
No - I’m in Bali
7 hours ahead of you guys. Should leave this alone but the story is compelling and I do trade big swings, so best to keep an eye on this.
As a final point, Barker will be looking regularly at models and projections relating to the next few years - not next week or even next month. He obviously likes what he sees, so much so that he added a cool £2m more of his own cash to the story. Not a decisive investment case, but certainly an indicator of the trajectory and future potential.
GLA
*I think April will be a nothing set of results myself. It would be how they trade over summer thats important.*
Same was said about the last couple of updates / trading periods. However, ‘nothing results’ are absolutely fine here. Continuing profit, cash generation, inventory reduction and soon debt. In short, steady as she goes.
I also think the re rate could be quicker than some expect. See how fast it falls on tiny volume because of the tightly held shares and small free float. Same will apply if buying starts again.
Just need some trackers to take notice and they will with consistency in results - even if they’re not spectacular. A move back into the FTSE 250 would be a game changer in this respect.
I respect the bear 🐻 thesis but it always appears quite superficial and shortsighted.
The company is being appraised on its old way of doing things. The question is more what is it becoming and how then should it be valued:
“ASOS is becoming a faster and more agile business, aided by the incredible work of our teams to speed up all of our processes to deliver the fashion, quality and prices that our customers want, when they want it. I'm excited by the performance of our new collections, while we have also made great progress in monetising inventory that built up over the pandemic and in improving the core profitability of our operations. We have reconfirmed our guidance for FY24 as we lay the foundations for a more profitable, cash generative business from FY25 and beyond."
Shell thinking of leaving LSE because of chronic undervaluations:
https://www.bloomberg.com/opinion/articles/2024-04-08/the-lse-losing-giants-like-shell-is-a-very-real-threat
Even Shell thinking of leaving LSE because of chronic undervaluations:
https://www.bloomberg.com/opinion/articles/2024-04-08/the-lse-losing-giants-like-shell-is-a-very-real-threat
*If it was listed in the US likely to be worth at least 5 times more than it is currently.*
Strong point. I’d forgotten for a moment the absurd LSE valuations.
Agree with sj74, of course.
“There’s £330m of liquidity”
Trading update said £330m gross cash at hand before undrawn facilities.
“6 pounds would be a super generous offer with the issues/debt etc asos had.
That's a near 100 percent upside + having to take that debt pile”
And this is why an offer won’t be entertained until the turnaround has firmly taken hold. In fact, I would be amazed if the BOD hasn't had several offers / proposals- including re Top shop etc…
The bears 🐻 are focused on today’s SP, whereas the BOD and those of us bulls 🐂 who believe in the turnaround are focused on 2-3 years from now. Yes it’s a long wait but that’s the nature of a turnaround - particularly in a horrible market.
More will be revealed on the 17th but even then I don’t expect a sudden miraculous re-rate. Probably take a few more profitable quarters and some bites out of the debt.
GLA
I don’t personally think it’s likely, unless an unexpected suitor turns up - US VC for example. Amazing to think £12 was turned down not long ago - or perhaps it just feels like that with the current share price.
Jose must deliver … Barker has the impatience of youth and success - can’t imagine he’ll wait around forever.
MA really is the wild card here. Although, I can see how every scenario is a win for him.
Good post, Simon.
Strong points.
Although, a minor difference is director buys
- such, are neither here nor there to me. I’ve seen directors pile in just before bankruptcy so as far as I’m concerned what’s important is that the investment case remains. What they do with their money is up to them.
A take out would be great right now. And I don’t mean dominoes - although, given that I saw a dominoes delivery driver right here in Bali last night means it’s not beyond the realms of possibility.
GLA
Yes about as valuable as a buy rating.
OK, debt is a problem but what they’re basically saying is at worst things might take a little longer. Interesting, given these analysts are the first to wheel out the old ‘give any investment 5 years … etc..’
Well, I’ve been here around 15 months so more than 3 and a half to go.
How low can this get I wonder?
Yes MA too.
Don’t really understand these puts but he doesn’t seem to be winning many of the bets.
Interesting to watch and I remain very confident here, personally. Just a question of patience.
Price action here is so predictable. Probably get smashed down to circa 330p before decent results.
Just a playground for manipulators.
Incumbent on the BOD to put a stop to it with decent numbers and reassuring words.
.
Bunch of people jumped ship, recently?
Sales director? Group or..? If group, that’s a big job and generates the question of why there’s a vacancy. Clearing the chaff after poor performance? Or simply the transient nature of sales / the industry? Point is, they’re pushing on.
Agree re the ‘expanding rapidly’ … should that read, expiring rapidly? Or expending rapidly. Trakm8 are certainly known for typos…
GLA
I don’t see the short positions as relevant to the April update. They rise and fall with the technical signals - it’s such an obvious correlation.
However, there are also no buyers of meaningful volume and that is down to sentiment and a lack of appetite for the risk here. So, yes the market must be reassured by the April update (West’s post was good on this point and how ASOS might reassure) and hopefully some funds will buy in and we can make a meaningful push upward - improving the technical signals and the shorts will reduce.
A move back into the FTSE 250 would be extremely helpful.
GLA/DYOR
Https://www.asosplc.com/investor-relations/events-centre/
Expecting more steady as she goes. We already have the gist from the March update but some more meat on the bones will be good and provide further reassurance that the recovery continues here.
The patient will be rewarded, I believe- either with the advent of decent numbers (which will turn up when macros improve further) or a takeover (less likely but certainly possible).
Good luck to all
“Ian Kellet has gone totally AWOL. That post of his - I'm amazed it's still there. He's lost a huge amount.”
What did it say?
Always was a binary outcome here in my opinion.
Could do couldn’t it? Although I head the Severn investment chap on LBC saying that companies that use Nvidia might start to manufacture their own chips to break the stranglehold and obviously reduce refinance and cost.
However, I wish you the best of luck. I see why shein and so might make some nervous here and that’s ok.
I don’t think it would take much to see £10 here to be honest and then there’s the chance of an offer. So whilst there’s risk, there’s also a clear path to reward, near-term. See what the detailed results say in a week or so.
Right, off to Bali for 3 weeks.
See you on the other side.
PS, the shorts follow technicals so no wonder they’re up at the moment as the technicals look horrible here.
Probably see Frasers RNS an increase in Puts too.
GLA