Member Info for MSG4GO

@Trenners Fortunately I stirred away from POG but I stack with Evraz... Who knows what is going to happen there...

About THG I got it wrong, and the blame is on me. With that said I added some more today via SB as it is a short term position. I still believe there is going to be a short term bull ride which is actually long due. I'm having in mind TED once the deal was withdrawn, TED SP fell below 70 and now has bounced back to approx 90.
Let's see... I hope I am not wrong once again :)

Yes... And I thought my first position at £2 was an opportunity... And another one when I top up at £2.3 as I thought the trend has reversed...

I believe so, too. They had an inventory of almost 900 million many of those unsold from previous season that delivered late.

Success in Fast fashion in general and Asos in particular, based on low inventories but the current supply chain challenges forced them to build more inventory.

Cancelling orders maybe an indication of slower growth, but it will help with the balance sheet and currently Mr Market seems to pay a lot of attention to fundamentals and the underlying strength.

We cannot avoid looking at the SP and get depressed, but we tend to forget that shares aren't lottery tickets, a company is behind.

I came across this article https://beautymatter.com/articles/the-future-is-in-the-hands-of-the-brands-lookfantastics-new-start-up-initiative which informed me about Fantastic Futures initiative by Lookfantastic, what to don't like about it, THG has only to benefit by it.

In the same article was also this "Alongside sustainability, Lookfantastic has also reported increased demand in the body care category. With the onset of summer holidays, the demand for SPF products continues to rise, also spotlighting a change in preferred tanning formats, with searches for gradual tan up +40%.*"

Do we know how much of the THG rent expenditure goes to Matt? Here is my thinking, if this bad boy cuts the rents THG pays, THG becomes immediately profitable and the SP flies high (I know I am talking cr@p but it is Friday after all)

Today is very disappointing... Let's see if towards the end of the day, this turns back to green.

There is a mini bull run for many of the shares, but this has stuck and doesn't want to take off

The truth is that MM listed THG with a high valuation, raised the money and the SP had a good run all up to £8... So, I am not sure why he complained that much after the SP collapsed.

Just to make clear, I am not happy with the SP because I am quite under like everyone else, but I believe a bull run will come eventually. After all above everything are the numbers and if Matt delivers on this front the SP will follow.

Also listing in Nasdaq doesn't necessarily mean the SP will fly high. I remember GAN plc (online gambling), they delisted from LSE and relisted it in Nasdaq. From $13 it went all the way up to $30 but now is trading back to around $3 below the valuation that had in LSE.

Boohoo had to do something to bring down admin costs, which are massive in comparison with Asos. In addition I believe this decision is going to increase number of premier accounts (premier account holders tend to shop more).

"Early analysis of social media responses by Barclays suggests that resistance may be misplaced. Barclays analysts found a muted Twitter response to the fees. Less than 1 per cent of tweets directed at Zara and Boohoo mentioned the charges in the weeks after they were introduced in the UK, they estimated, with sentiment towards the brands within historical average ranges — though for Boohoo it is still early days."

https://www.businesstelegraph.co.uk/fast-fashion-is-slowing-down-for-its-own-good/

CMC I think has better spreads for THG. All the CFDs/ SB providers have the same leverage, this is a regulatory requirement to protect retail investors.

If you are looking to hold for a short period, you may want to check Spread Betting instead of CFDs... It has better spreads and you are not prone to capital gains tax, but you pay overnight fees.

This isn't an investment nor a tax advice of course :)

CMC I think has better spreads for THG. All the CFDs/ SB providers have the same leverage, this is a regulatory requirement to protect retail investors.

If you are looking to hold for a short period, you may want to check Spread Betting instead of CFDs... It has better spreads and you are not prone to capital gains tax, but you pay overnight fees.

This isn't an investment nor a tax advice of course :)

Few days ago, Deliveroo came with a disappointing update, cut growth considerably but after the update is up 30%...

Deliveroo isn't the only share that performs will recently, actually it seems we have a mini rally from lows... Most of the shares are up 10 - 15% except of course THG... How disappointing is this...

I am not sure how good burberry results are, because of 35% decline in China, 19% in Asia and 4% in US... I am interested to see what Mr Market will make out of them in about 20 minutes.

About Amazon though, the amount of orders is mind blowing. Obviously there are money still to be spent... More spending please in MyProtein, Look fantastic and cult beauty products :)

Do we know why whey prices are falling? If it is due to increase in whey offering or decrease of input cost to produce whey, these are good news, if it is though because of decrease in demand, maybe bad news lay ahead.

This is what happens when the market from euphoria falls to depression... £8 was ridiculous then, £0.75 is a joke now.

Patience is a virtue

Of course the balance sheet doesn't matter... It doesn't matter how much cash a company has, in which rate it burns cash, how much debt has and what interest pays, if it can pay its suppliers, if they need to raise more cash either from shares or further debt... All of these are just noise to distract the investors. I don't know why they even bother to report these numbers....

Well, I don't want to break the news to you but Mr Market does check balance sheets especially during market down turns and for this reason many high growth companies have lost much of their valuation...
Also, I don't know when was the last time you checked THG SP, from your last comment it seems you hare still in January '21.... Wake up! THG from £8 worth now £0.80. Ocado from £30, £8

If someone day trades and his entry point is in the morning and by afternoon tea he is out, then the balance sheet is useless, but when someone takes a long position to any company, the balance sheet is the first should be checking. Lastly, checking the net asset value of a growth company can indicate when the fall will stop.

Yes, it seems like THG is undervalued currently based on the balance sheet, but it isn't only THG. Check Asos for example, it has a market cap below net assets, too and I'm sure there are also many other companies out there that been oversold.

There is too much pessimism out there, all we need is some good results and patience.

Clearly THG is a better investment in comparison with Ocado.

For me and for my long term positions, I start with Balance Sheet. The comparison between Ocado and THG, Ocado seems to be overpriced for their net assets. They have £1.7 billion of net assets and their market cap is £7 billion, in contrast THG has similar net assets but a market cap of less than £1 billion (Of course for THG there is £1.5 billion of intangible assets, which maybe a bit overstretched within the current inflationary environment vs Ocado £0.5 billion).

About borrowings, Ocado has £1.3 billion of borrowings while THG has something less than 0.5 billion.

Ocado
https://www.ocadogroup.com/media/qwlchfvz/ocado-group-annual-report-2021-full.pdf

THG
https://dl8hes3yo0qpy.cloudfront.net/wp-content/uploads/2022/05/09101431/Annual-Report21-FINAL-linked-compressed.pdf

I think we need to be a little bit realistic and to take under consideration the climate out there... I wish also a buyer to come tomorrow and to offer £2.5 / share or more for my position, I wish Softbank to exercise their option and inject 1.6$ billion into Ingenuity, but how likely a scenario like this really is? Personally, I don't think it find it highly unlikely.

Once THG made the offers public, I didn't see other buyers queueing to buy the firm. This isn't necessarily because of THG, but it is more what is going on currently on the market, the collapse of valuation, the rising rates, the upcoming recession and the margins squeeze.

Here is an article that focusing on PE and why the buy-out boom is closing to an end
https://www.economist.com/business/2022/07/07/private-equity-may-be-heading-for-a-fall

Yes, they bought it 34% of shares in the prettylittlething (PLT) brand from his son for around 270 million pounds. So the valuation of PLT at the time of purchase was per Boohoo was circa ~1 billion...