Member Info for RedNinja

I think US market futures have now turned + ve.
However, still think there are enough market risks around to a US or even global correction.
We'll see ...

US stock market futures are not looking good today either so I'm thinking their is more turbulence to come.
Is it the long heralded correction to US equities ?

Well the global markets are not looking good at the moment, eg from Blomberg :-

"Futures on the S&P 500 and Nasdaq 100 indexes lost 0.5% each after the underlying gauges ended September with the biggest slides since March 2020. European stocks headed for the worst weekly plunge since January. Occidental Petroleum Corp. led premarket losses in New York as oil’s rally stalled.

As investors brace for the Fed to wind down its stimulus, fears are mounting about slowing economic growth, elevated inflation, supply-chain bottlenecks, a global energy crunch and regulatory risks emanating from China. A short-term deal that averted a U.S. government shutdown was dwarfed by concern the crisis could return in weeks and also delay Biden’s $4 trillion economic vision.

“A rocky start to the quarter is inherited from the wobble in U.S. equities amid a patchwork approach to avoiding a fiscal cliff conspiring with rising fears of inflationary shocks accentuated by the scramble for energy,” said Vishnu Varathan, head of economics and strategy at Mizuho Bank Ltd. “The threat is not merely interrupted growth/recovery but rather self-inflicted pain amplification between U.S. fiscal fumbles and China’s regulatory agitation.”

https://www.bloomberg.com/news/articles/2021-09-30/asian-stocks-set-to-follow-u-s-equities-lower-markets-wrap

Well we know some of those cost increases will effect all like gas and oil.

However, some may be specific to Boohoo which I believe was using very low wage suppliers and maybe now has been forced to pay more for it's production.

Boohoo having an adverse effect on online retailers :-

"On AIM, boohoo Group was down 10% after the online fashion retailer not only warned that Covid-19 is still hitting consumer demand, but it also cautioned on rising costs as inflationary pressures accelerate.

Revenue during the period rose 20% year-on-year to GBP975.9 million from GBP816.5 million. Compared to two years earlier, so before the onset of the pandemic, the fast fashion firm's revenue was up 73% from GBP564.9 million. Rising costs have hit profits, however. Pretax profit fell 64% to GBP24.6 million, from GBP68.1 million a year earlier.

Looking ahead, boohoo expects full-year sales growth of 20% to 25%, which implies second half sales growth of 20% to 30%.

However, annual adjusted earnings before interest, tax, depreciation, and amortisation margins are now expected to be 9% to 9.5%, lower than 9.5% to 10% as previously guided. This reflects ongoing investments across technology, offices and infrastructure, boohoo noted.

Further, boohoo warned elevated short-term cost pressure experienced in the first half is expected to continue in the second half alongside recent freight cost inflation in the supply chain and wage inflation within its distribution centres.

AIM-listed rival ASOS was down 4.9%."

https://www.lse.co.uk/news/BOO/london-market-midday-stocks-mixed-oxford-nanopore-soars-on-debut-1apl48qjpup4ch4.html

Well it will take one if it is good enough and the house broker seems confident.
I am tempted to buy a few more, but I have enough exposure.

I did wonder if this would close below 50p, but generally seems to want to yo-yo in the 50 - 52p range.
The results on Friday 8th October 2021 should give the share a sense of direction.
Maybe there will even be a bit more info. on the Allianz claim.

Having said that some largish buys today 50k, 100k, 90K and 225k amongst others.

There are still punters who think they are getting a bargain.

VLG has a credibility gap.
It will take a few good results RNSes to turn it around.
All IMO.

If you look at the interims the gross profit was up by 22% whereas in the finals gross profit was up by 13% .
Thus, although finals were good, the fast money was hoping for something more like the interims.
It's true the finals were in line with broker expectations and trading update, but the fast money was still hoping for a little bit more.
On top of that markets are more negative now with correction fears, inflation fears, gas supply fears etc etc
All IMO.

Time can thus be bought at a discount to NAV and if profit rise according to the house brokers expectations then in a few years time the sp should achieve a reasonable rerating.

However, market worried about inflation, US correction, Chinese property debt so it may be that we won't see Time rerate for a while. I am biased as a holder. DYOR.

Investor'sChampion has these as a cracking buy, a few points they note :-
---Earnings per share rose 3% to 1.98 pence.
---Net assets at 31 May 2021 were £57.1m with tangible net assets (excluding Goodwill) of £28.4m. This compares to the current market capitalisation of £22m (share price 24p).
Broker forecasts
Following the June trading update the house broker reinstated forecasts.
For the year ending May 2022 these are for revenue of £27.3m and adjusted earnings per share of 2.8 pence.
For May 2023 revenue is forecast to rise to £30.8m with adjusted earnings per share 4.6 pence (+64%).

Well Equity Development is paid for research and although that does not mean it's incorrect. The market does not necessary pay a lot of attention to it
Results were reasonably good given in pandemic and several indicators improved :-
• Profit Before Tax, Exceptional Items and Share-Based Payments ("PBTE") for the year of £3.1m (2020: 3.0m), an increase of 3%
• Earnings per share of 1.98 pence per share (2020: 1.76 pence) an increase of 13%
• Consolidated Net Assets at 31 May 2021 of £57.1m (2020: £55.2m), an increase of 3%
• Consolidated Net Tangible Assets at 31 May 2021 of £28.4m (2020: £26.5m), an increase of 7%
• Cash, Cash Equivalents and Convertible "paper" of £11.3m (2020: £1.4m)

However, negatives were decrease in revenue :-
• Revenue for the year of £24.2m (2020: £29.2m), a decrease of 17%

Mmm yes but there is the small fact that Allianz have increased their financial claim against BWNG by £36 million which will only be resolved next March.
Worries of general market correction, and the economy generally not helping either.

"The Offer Price of 90 pence represents a discount of approximately 13.5 per cent to the closing mid-market price of 104 pence on 19 November 2020"

Keith Todd has bought another 1434 shares :-
"KRM22 plc (AIM: KRM.L), the technology and software investment company, with a particular focus on risk management in capital markets, announces that the Company was notified on 16 September 2021, that on 14 September 2021, Keith Todd, Executive Chairman and Chief Executive Officer of the Company, purchased 1,434 ordinary shares of 10 pence each in the Company ("Ordinary Shares"), at a price of 25.2 pence per share."

Share price advancing a bit today with more buying.
Hopefully this bodes well for some contract wins.
Personally I am not feeling confident to put more money in the pot...

Nothing guaranteed in this world, but they updates/results they have been giving us since the pandemic struck have shown upward progression.
The appear to have been recruiting new staff to lead the business forward.
I am hopeful too.

As far as I can make out the company is expanding to meet a need as government lending/cash hand outs will be decreasing.
Bought a few more today at 24.8p

Share price does not seem strong today.
People in the know selling out before results or general market nerves ?