Adrian Hargrave, CEO of SEEEN, explains how the new funds will accelerate customer growth Watch the video here.
Well said Teddy100 - Shein and Temu are disrupters on steroids. These companies have huge backing by rich funds. Boohoo and ASOS have no money except in loans or RCFs.
T4g - website traffic doesn't mean purchases. They'll be lucky if one in 4 of website traffic purchase items.
You're out of touch with today's website traffic and conversion rates.
Never buy shares for fear of missing out. If this is your impulse, then sit on it for a number of days/weeks to see what happens to the share price. Better to protect your hard earned capital than lose it on fear of missing out.
How this could affect Boohoo.
Aarin Chiekrie, equity analyst, Hargreaves Lansdown:
“ASOS has had a rough ride lately. With net debt and cash flows both rising earlier this year, it had to resort to raising around £80m of new funds by issuing new equity shares. This isn’t usually a good sign, as it waters down existing shareholders’ stake in the company. However, the cash injection has provided some wiggle room to execute the ongoing transformation, so we’ll be looking out for early signs that it’s bearing fruit in next week’s trading update.
With revenue declining at double-digit rates in the third quarter, profitability rather than growth is now the order of the day at ASOS [LON:ASC]. Resources are being reallocated away from the US, where extensive investment has so far yielded weak results. Costs are getting stripped back too, with the group on track to hit its cost-saving target of £300m last we heard. These actions should stem the financial bleeding to some degree, so keeping a close eye for more guidance on where full-year profits are expected to land.”
EBITDA is a helpful metric as it helps you understand the core business performance but I think all investors agree it shouldn’t be used as a main KPI. It is too often becoming the default measure for companies to report on and many investors dislike that. What investors want to know is the PAT, the cash flow and the bridge to the EBITDA.
So investors like to exclude positive interest and include negative interest for example and they like to know whether depreciation is acquisition related goodwill or capex. They need to factor in as that gives better clues as to how a business will perform longer term but it’s a secondary metric.
Cynically, it is a lot easier to show a positive figure with EBITDA than with Post Tax profits - the heart of the matter. Also the ratios look smaller using EBITA and so seem more attractive.
You should read what Warren Buffet says about EBITDA. From memory, and I paraphrase, he says why stop at Earnings Before ITDA - why not use Earnings Before all expenses ?
"Who actually wants to be told about EBITDA? Hardly any private investors see EBITDA as a main profit measure. Indeed, most of the fund managers I listen to on webinars/podcasts also seem to dislike the focus on EBITDA. So why on earth do companies/PRs/brokers give so much focus to a profit measure widely seen as unreliable? It’s an ongoing bugbear, where the city is simply not doing its job of communicating to companies what many/most investors actually want to see in trading updates. Surely it’s the (adjusted if necessary) EPS figure that matters most, and is the most useful? Why not give several measures, including EPS, and EBITDA, to keep everyone happy?"
Many investors don't even look at EBITDA, if it's the only number they give, they go to the brokers note for EPS forecasts. If there's no brokers available, then they're not buying.
RNS released this week alone, we had
• EBITDA
• Adjusted EBITDA
• Statutory EBITDA
• Cash EBITDA
’The question is,’ said Alice, ‘whether you can make words mean so many different things.’
’The question is,’ said Humpty Dumpty, ‘which is to be master — that’s all.
People who want to sell shares in the closing auction includes the market makers. Have you ever bought or sold shares in a closing auction? No because the only online to have access to closing auctions is IG. Otherwise you have to o find a broker who has access to the closing auctions. It's an extremely sophisticated system which lasts for less than 30 seconds where you put in your bids and asks. Who do you think would have the most expertise to use closing auctions?
ASOS have now gone into the USA twice and failed. What makes you think Boohoo won't fail too?
Maybe website traffic - website traffic doesn't mean purchases. It's only website traffic and not purchases.
When will you ever learn that website visits doesn't mean purchases.
West6809 - answer the question and stop deflecting from it - so who do you think puts shares into the closing auctions, i.e. the UTs?
West6809 - so who do you think puts shares into the closing auctions, i.e. the UTs?
You need to be taking note of this statement from Aarin Chiekrie, equity analyst, Hargreaves Lansdown and how this could affect Boohoo:-
Asos' resources are being reallocated away from the US, where extensive investment has so far yielded weak results.
West6809 - who do you think puts shares into the closing auctions, the UTs?
West6809 I didn't say anything about the highest or lowest price for auctions.
Auctions are based on supply and demand and it is this that sets the uncrossing price.
The Watcher2022 - if t4g had listened to pedro61 etc at 320p for his 40,000 shares then he would have been in the money at about £130,000. Instead he held onto this shares all the way down to 32p and even bought more at about £3 and £2.
Oke - so desperate to get the Boohoo share price up.
How this could affect Boohoo.
Aarin Chiekrie, equity analyst, Hargreaves Lansdown:
“ASOS has had a rough ride lately. With net debt and cash flows both rising earlier this year, it had to resort to raising around £80m of new funds by issuing new equity shares. This isn’t usually a good sign, as it waters down existing shareholders’ stake in the company. However, the cash injection has provided some wiggle room to execute the ongoing transformation, so we’ll be looking out for early signs that it’s bearing fruit in next week’s trading update.
With revenue declining at double-digit rates in the third quarter, profitability rather than growth is now the order of the day at ASOS [LON:ASC]. Resources are being reallocated away from the US, where extensive investment has so far yielded weak results. Costs are getting stripped back too, with the group on track to hit its cost-saving target of £300m last we heard. These actions should stem the financial bleeding to some degree, so keeping a close eye for more guidance on where full-year profits are expected to land.”
West6809 - you need to talk to a real broker about UTs
Volume of shares throughout the trading day, the volume of the UT for the closing auction at the end of the day, the share price going down, these are all such important indicators for the shares you're invested in. Hence why it's so important to understand them and never take on board the lack of understanding of what these mean i.e. the hysteria about them.
West6809 - another one who needs to talk to a real broker. You've no idea how the share market and UTs work.
I can't believe people invest in shares without knowing all this.
Pipedreamer - consensus estimate from all brokers' analysts for end of year 2024 is for a net loss of £18m for Boohoo.