Member Info for Rhambo

This is likely to see shareholder value haemorrhaged/wiped out: https://www.telegraph.co.uk/business/2018/04/08/mothercare-becomes-latest-high-street-retailer-weigh-store-closures/

Not sure it'll go bust yet. I think most likely outcome is dilution through D4E. I suspect the CEO change is a pre-condition of any deal. I would guesstimate dilution to be in the 60-75% category (because there still might be a business in there somewhere), which suggests a post-dilution share price in the 7-9p bracket.

Also I suspect the Q4 statement on the 12th is going to be pretty dire with some element of kitchen sinking going on, hence having a new man in to blame it all on the ancien r�gime.

The guy has just come from Tesco, which is not exactly a school of hard knocks when it comes to company turnarounds.

They're not made to create upward momentum in liquidity because as you note the share quantities are small vs the issued (that said, the recent spike up to 20p was done on very low volume). Rather, it's a PR exercise (if the BOD are buying then they must have confidence in the future direction and think the price is cheap, therefore I should buy too). But, as you note, this is not the first time they have deployed this tool and there has been the opposite direction of the share price versus that which was intended. It is a salient point that the big moves are in essence in the hands of hedge funds and large private investors. Ultimately, their analysis of whether to buy, hold or short has a lot more impression because they are neutral, powerful and (possibly) knowledgeable. They are also likely to have closer contacts with the BoD than you or I and if they start off-loading then it usually is a signal for the rats to flee the sinking ship.

Relative to their personal fortunes, they were not huge sums. It's a common trick for directors to make token purchases after delivering bad news to try and shore up the share price, I'm surprised they think it still works.

Owners of shitty small caps will always look for the bogeyman as a reason for the share price demise. Any positions of significance are always declared. It's not a ghost seller or the market makers, it's just weak demand at higher ask prices vs high supply of willing sellers

Mr Jennings, I have no interest in holding here but as an outside watching what is going on your actions are most commendable and reasonable. All the best and good on your for actually taking action rather than just 'taking it'.

FIO: https://shorttracker.co.uk/company/GB0009067447/ Blackrock divisions short at these levels (c.19p) as of 5&6 Mar. If it gets any higher suspect they will add.

I wonder if being tied in with the same 'mentality' as BHS from its Storehouse days means there are too many dinosaurs at HQ used to marching on in the same old way.... perhaps getting the same old result as their former cousin...

Because presumably they had already sunk enough forward-planned capex into it that it was too late to not try to recoup some money by opening. The company has said it is near its debt ceiling and is using language like 'waivering of financial covenants'.... this is just not investment grade.

@Book-worm ... Anyone that needs to appoint another company to look at ways of stopping it going bust shows that the company does not know how to turn itself around. I have to say this is a dead cert for a 0p. Ask yourself - how many other companies are out there where I don't have to take this risk?

The shit has already hit the fan hence you have retailers going to the wall (toys r us, claires) and the reduction in real wage growth has already hit retail. Retailers able to ride this out (and you would have to fancy a cash cow like Next to do this) will be able to benefit from reduced market capacity once real wages catch up again.

Doubt it - profit in line with expectations.

i'm more than happy to see lower if the market wants to take it there temporarily. We're at a technical low and the PE is c.12,which is pretty low vs the market. The yield is looking just great at the moment and increasing.

hence the use of the perfect tense...

Looks like the past couple of days' falls is due a building short position from 'Kuvari Partners', who appear to have shorted Carillion and Mitie: https://shorttracker.co.uk/company/GB0004915632/

Also run a PEG calc on basic EPS and it comes it at 1.27 assuming 10% eps growth next year... which suggests there could be some headway with the valuation on growth in these bull conditions but combined with the divi growth the investment case is whilst not compelling it certainly is strong, especially from an income standpoint.

If you take a long term approach then you shouldn't lose to much sleep. Obviously careful on the portfolio balance..

Fill your boots, the yield just got more attractive.