Member Info for LorenzoLynch

Jed,

I know, I was only joking about the Tesco meal deal, but even if you can make £1,000 from a 2p rise, isn’t selling up a bit stupid if you think the company is worth £1 more than you’re selling at (for example)?

If you’re a day trader, then yes, I respect that you’re viewing things from a different angle to me, but if you’re an investor, I think it’s foolish to focus on the week ahead.

That’s my view, but yes, I agree, each to their own.

Paddboy,

It’s funny you say that, because I also see a clear pathway to £3 per share.

With 10+ year time horizons, you’re an inspiration, and you must have a long life expectancy 😂. I’m in my early 30’s, but 4/5 years is the max for me. I think it’s usually impossible to accurately forecast further ahead than that (unless we’re talking about Coca-Cola).

It’s taken some real bottle to hold this through the storm. I suspect that you’ll be handsomely rewarded.

No, I don’t know where this is going to finish in the next few days, which is exactly why I’m not buying or selling any shares. I’m not a day trader.

I’m investing now, because I’m incredibly confident that this will multi-bag several times over if the company is able to deleverage over the next 3-4. I believe this will occur, as long as there isn’t a black swan event.

Those who have sold out completely - yes, I’m confident that they don’t know what they’re doing. What about the investors who have bought? The share price is up, not down, so there have obviously been more buys than sells.

Jed, if you’re happy just making enough money for a Tesco meal deal and half a pint of Carling, that’s your decision. Good luck to you.

My time horizon isn’t a few days… now that would be gambling! Let’s see if Mobico is significantly higher than it is today in a few years… my estimate is, say, £1+ within 3 years, ok?

Jed,

How is it a gamble? Please explain to me how investing into profitable businesses is akin to backing a 25/1 outsider at the Grand National.

As for ‘nothing happening’… have you not seen the share price rally?

As for 28p, the risk was far greater before the deal closed, so why would it return to 28p?

What planet are you on?

The short-sightedness from some investors absolutely baffles me…. I can see why some people never great experience returns.

Some of us invest for 2-4 years and end up with multibaggers… others jump ship after a couple of days on the first little leg up.

One can only imagine the ‘I would have made a fortune if I remained invested in *insert any stock which was ridiculously undervalued when they sold it*’ conversations around the Christmas dinner table every year.

Always remember, if you’re holding a stock and you’re in utter disbelief about how cheap it is, it’s because there’s an army of fools out there constantly pushing the sell button, because they ‘have a feeling’ it’s going to fall.

It’s absolute madness, but madness which I consistently profit from greatly, nonetheless.

Glowacki,

As did I, but both notifiable shorts have increased their short positions today (I’m assuming to prevent a rally?).

It seems to have worked… for now.

Petren,

Why would they? There is no need for them to commit to paying it off with an RNS yet.

As the management team are also shareholders, one can reasonably expect them to take the course of action which is in our best interests (paying off the hybrid bond imo).

By refraining from committing to this, it gives them some level of optionality, however. For instance, they might choose to refinance to pay that £250m, so they can pay off the fixed deadline £500m bond first, without any liquidity concerns (should a black swan event occur).

I think it’s a ‘let’s just wait and see what the best course of action is when the time arises’ situation, which is the smart move imv… especially if they’re planning to buy some more shares in the near future.

I think the plan is to simply strengthen the balance sheet as much as possible, and then cross the hybrid bond bridge at the appropriate time… it’s a better use of their time to focus on improving operations and reducing costs imo.

Ben,

The impairment is non-cash; and is therefore inconsequential imo.

Cash is everything for a deleveraging stock. A collapse in cash flows would be the time to worry.

Naturally, do your own research on this subject. Ai can probably advise you well on this very impairment and its (lack of) significant implications for Mobico.

This was the game-changer RNS for me personally.

Assuming that operations remain stable or improve (I’ll be amazed if it isn’t the latter in Germany and the U.K, at the very least), my forecasts are blowing my mind.

I increased my holding by 50% on the bell.

Flatliners,

No matter what stock you post about, one thing remains the same: you’re always talking out of your backside.

What I’m really perplexed about is how these tariffs do not appear to be legally enforceable, at all.

You can find lengthy articles about this on Google.

So what happens next? Is Trump setting near-term deadlines and dishing out threats to wrap up some advantageous trade deals, before the courts thrown the tariffs out?

As for how E.U tariffs impact us… it’s a double-edged sword imo, but shouldn’t be too material in their direction. The luxury fashion houses would take a significant hit, however.

I do think Nike etc would move their few European productions elsewhere if 30%+ tariffs are imposed, but I really don’t see this happening. The backlash from the U.S elite and middle class would be monumental when the tariff inflation is felt on cars, alcohol and watches etc imv.

Dwam,

Over time, capital flows in and out of the various assets classes; and in and out of stocks within each industry.

JD’s industry is out of favour atm. I doubt it will last forever though.

Financials were on their arse until this year, but many of them have rallied strongly this year. Even Lloyds is up over 40% in the past 6 months!

I’m not aware of any publicly listed business which has performed well consistently over the long-term, without the share price eventually following… not even one.

Redd,

Remaining competitive in the U.S is always going to be the biggest challenge for any multi-national company that operates in the west in my opinion.

JD’s market share gains and acquisitions over there position the company well imv; especially when you consider the data sharing across their platforms, as their businesses each haven their own strengths and market insights.

I’ve never been to the U.S (out of choice, may I add), so I’m not expert on their sports fashion sector, but I did read online that Hibbett is one of the best places to go for affordable official sports clothing e.g. football kits, baseball caps etc.

I pay little attention to events which will impact the entire industry; my focus is always on how a company is performing vs its competitors, as I think this alone determines long-term success or failure.

Industry headwinds usually seem to help the stronger players in the long-term (survival of the fittest).

I’m a very relaxed holder.

Flowerpower1,

How is this heavily shorted? There are 2 fairly small notifiable short positions open. That’s next to nothing imo.

I’m sure Card Factory was shorted to a similar extent when it was 30p…. It rose to around £1.50 before long.

If 40% of the float was being shorted, then I’d be concerned.

I’m pretty sure you know this though.

Do you also have a short position here? Why are you concerned about the share price here? Just out of curiosity.

I have a long position (around 6.5% of my portfolio). Can you speak with the same level of transparency?

Reddukclothing,

“Lorenzo, which competitors are you referencing?”

Footasymlum, Sports Direct, Dicks, Footlocker and many other bin dippers.

“The markets are more concerned with Jd sports as they are a reseller mainly, that impacts the margin mitigation”.

If our suppliers can mitigate the cost increases, then this saving will be passed onto us. JD and their suppliers have a mutual dependency…. If JD’s sales fall, so will Nike’s, and vice versa.

If our suppliers increase prices, then we will do the same.

A key consideration: IF Nike have to move their operations, who pays for this? Nike.

We can benefit from supply chain shifts without the capex investment.

Honestly, if there was a major risk here which I could see, I wouldn’t be a shareholder (I’m not a fan of the industry, to say the least)

It’s going a bit off-piste here…

JD do not produce or sell iPhones, so the comparison has zero relevance imv.

They also do not manufacture all of their own clothing, like Nike.

As for Nike, they DID NOT SAY, that tariffs are going to cost them $1bn per annum, they said “The company expects tariffs will cost it $1 billion in the current fiscal year before price increases and supply chain shifts” - copied from an article, so might be paraphrased.

Note ‘BEFORE PRICE INCREASES AND SUPPLY CHAIN SHIFTS’. In other words, BEFORE mitigation. That is, before trade deals, before adapting their supply chains and before increasing prices etc.

Even a $1bn hit would only equate to roughly 2% of their revenues. Note, this was also said before Vietnam agreed a trade deal with the fat fake tan man across the pond.

Trainers and clothes are usually cheap to produce, so I can’t see 10%-20% tariffs destroying the industry.

Hoss,

Apologies, my wording was awful, but I’m glad you understood what I was trying to say.

I fully agree with you.

I think the main reason for the market pricing this incorrectly is that the quality of the company and its competitive advantages are not widely understood.

I’m in my early 30’s, so I’m aware of its reputation and also how its main competitors are losing their appeal over here.

With regards to the tariffs, I don’t understand why people think they could or will ruin JD Sports, but not our much weaker competitors; many of whom have far weaker balance sheets imo.

No tariffs = no temporary hit to margins.

Tariffs = market share gains imv; which should be margin enhancing as weaker competitors fall apart.

Many can’t see the forest through the trees imo; blinded by emotion and level/stage 1 thinking…. For now.

TomBeef & Alessandro,

I think JD actually meets both criteria.

I don’t think JD is can really be called an innovator, because they have much need to innovate - which is great, because it keeps R & D costs low.

However, they do utilise data and data-sharing across their businesses, to continually develop the experience which they offer. This does appear to keep them ahead of the curve, when it comes to utilising store space in the most profitable manner. In this sense, they are innovative.

Uallmakeitup,

I’ll take a look, thank you. Top company, but I’ve never seen it at an attractive valuation; albeit, it certainly deserves a premium the market

I’ll be amazed if it stays under 40p after the completion RNS.

I think the SP continues on a steady climb after the initial rally as this finds its way onto the radar of many investors.

I’ll almost certainly be topping up quite aggressively if it remains under 45p. At 50p+, I might wait (and hope) that it cools off before I top up.