Member Info for simon1367

Murmurs.....Thanks for the reply. While you disagree with me, with respect, when I commented today I was largely reiterating aspects that I've conveyed before and what I have consistently argued would probably happen. Where we are today is what I have been forecasting for a while, often to people's annoyance on here. I see no reason to change my stance that this is going to be a slow recovery, with shareholders having to be patient. We know the next results will show a bigger loss. High and growing revenue is meaningless if the margins aren't there. All the while the shorters are in to this extent (it's the biggest shorted company on the stock exchange) the position remains precarious, which is why Frasers is waiting in the wings. If Asos's revised strategy works then Frasers strategic holding and cross selling will benefit. Conversely if Asos starts to struggle, I imagine Ashley will be there to the rescue with a silly offer.
BadJob.......I concur with your views, much of which I have conveyed before and been regularly berated for!

Claire.....Sorry, but you've been talking quite a lot of drivel on a daily basis. As I've said over several months, realistically there has only been one direction in which this share has been destined to travel in the short term. See all the reasons I've reiterated in my previous comments. There's a lot of hope and desperation on this forum. I maintain my view that this probably has further to fall and will stay in this sort of zone until we see how bad (or mild) the profit warning will be in January.
There's been mention here of the likes of ASC merging with Zalando. Unlikely. Firstly Zalando has a capitalisation of at least twelve times ASC, and so such a move would basically be a takeover no matter how it was dressed up. And why would Zalando, who have a more successful model and management (hence their better performance), launch an approach now, when they could potentially pick up the pieces at a lower price later on which, by the way, is what Frasers are waiting for too with their strategic holding. Neither are likely to pay a premium for Asos. Add to that the gloomy retail outlook and the questionable top management, it is hardly surprising that the share is being manipulated by the vultures who see more money making to be had. As I have regularly said, some of the shorters on that list know far more than me and most on here. Given the present level of shorting, there is no way I would put in large lump sums into this company. I will reassess after an update, hopefully in January. Investing now is only for the brave.

The sort of press release below is very unsettling. I'm frustrated at the continued upheaval at top management level. Where is the management continuity, and coherence in terms of a long term strategy? One of the biggest mistakes in my opinion was to buy far too much inventory because I think in this fickle industry it's inevitable there will be more write-offs. If there is cash call next year, heaven knows where the price will go.

The quote in question: "A year from hell for online fast fashion firm ASOS isn't getting any better as interim finance boss Katy Mecklenburgh announces plans to step down just over a month after taking on the role," said AJ Bell's Mould.
"While there's nothing unusual about someone in a temporary position getting a job elsewhere, and she's not leaving for six months, it ramps up the pressure on ASOS to find a permanent replacement for Mecklenburgh's predecessor Mat Dunn and adds to the somewhat chaotic feel around the business," he added.

T4G.....Let us hope that Capex does indeed come out within budget. Your comment implies it's a given, which it isn't.

Introducing the loss making 'Isawitfirst' to the Fraser brand is probably a useful add on. At about £20m, just pocket money for MA. I very much hope he did indeed undertake due diligence given Jalal Kamani's alleged dubious connections over the last couple of years.

Looking forward to a probable interim update in the next four or five weeks, followed by more results in March. We shall then see if your optimistic outlook is warranted. Good luck with that. I see Berenberg have downgraded. It looks increasingly likely i.m.o of little movement in the share price until the new year when things will look a little clearer.

T4G ......what other shares I own and trade in has no relevance to the subject in hand, that being the challenges that online fashion retailers presently face. As I've said, I hold ASC and monitor one of it's closest rivals to assess signs of recovery in the sector. I add comment where I see fit as part of a discussion forum. You don't need to be so aggressive in your remarks simply because you disagree.
Looking at the background, I don't like the rumours I've read in the past about the way people close to the extended family of the founding owners are allegedly connected to disreputable clothing businesses. Stories (and they may just be that from stirrers) occasionally crop up on an ongoing basis. In my view, there's no smoke without fire.
Having said all that, BooHoo's has a decent u.s.p , that is having a quick fast fashion supply network allowing it to react to changing trends quickly which can increase margins and at the same time keeping prices low.
However the company is spending heavily on anticipated increased capacity needs, particularly overseas. That could be very expensive if increased sales do not material as envisaged. Running massive warehouses abroad quickly turns into loss making territory when there are large cash outflows. Just look at the sort of companies who have failed in the states. It's so protectionist over there.
I'm sure there's a reasonable mid to long term case in investing here. But while the shorts are so high, I'll avoid. As a small private investor, I tend not to short, it's too risky a game for me.

Trading4good.....For your information I'm invested in Asos (at a fair loss at the moment), a company who in my view, despite weaknesses in present top management, has better long term prospects than boohoo. I keep an eye on boohoo as the market seems to align it very closely to Asos. If either one moves in one direction, the other tends to follow. And of course just look who the two most shorted shares on the exchange are. Is it any wonder I'm bearish in the short term? If these companies see through the next year without cash calls or profit warnings, then the prospects will be so much brighter.

The market hasn't particularly looked favourably with regards to BooHoo's increased stake in Revolution Beauty, a company in deep trouble with arguably a failed business model.
Given that RB shares are suspended and the purchase was done 'out of trading' one wonders what they paid for the shares. They probably bought them for a virtually nothing with a bit of spare cash, on the basis that it was worth a punt. Nevertheless Boohoo will most likely need every bit of cash going to see through the next year. If I were a RB shareholder I wouldn't be happy knowing that 'a mate' of the company has had the opportunity to buy in dirt cheap when everyone else has been shut out. Correct me if I'm wrong, but who else (eg. the ordinary share buyer) had the opportunity to buy a suspended share at an undisclosed price? On top of this the share is suspended due to, what would appear to be, dodgy accounting information.
I'm not invested in this share but monitor it given it's alignment with Asos in the retail sector. I have no intention of buying Boohoo given the continual rumours about the way the owners run it and the very high shorting percentage. Having said that, the price is very low and one could quite easily see this double in the next six months (so long as thee's no profit warning in the next six weeks) given the market reads things in advance of events. Of course the owners must still be thinking about taking it private on the cheap. That too would infuriate shareholders.

The BBC 'story' is not awe inspiring. Just general waffle. Barclaycard say sales are up 3.2% on last year....again hardly inspiring as we were then still coming out of restrictions. On top of that, the report states the bleedin' obvious...that people were looking for bargains this year! I think sales will turn out to be average at best. Black friday is slowly being recognised for what it is. Largely a con save for a few up front bargains. It will generate welcome cashflow but negligible profit. I stand by my previous view that we are in for a difficult few months. Sorry folks but this share is not going to rocket as some people think (desperately hope). Just keep an eye on the shorts. All the while they are above 5% the shares imo are going nowhere.

Grimrip: To answer the question. It simply doesn't work like that! Do not expect a large chunk of the 8.15% to all close out at the same time. They are more astute than that. A few may, for example, close out on say 0.20% on one day when there is a dip in the share price in order to take a bit of profit. They then often (if they are still bearish about the share) short again if the SP rises on a bit of positive press news. It's all part of the manipulation and is a slow process of playing the game. As far as I've heard there's no pressure coming from brokerages or their clients for these shorters to close out on large positions. I imagine they are making a nice sum on the interest margin in the interim period
SimonPassmore (my namesake!), I generally concur with your comment. Things will come good but not in the 'short' term.

Asos shorts up to 8.15%, not far from Boohoo at 8.47%. The fact is, these two are the top two most shorted on the stock exchange. I cannot see an upward trend on either share while the shorting level is so high. The manipulation has being going on for months. Much of the bad news is built in but nevertheless I think there is a significant chance of another profit warning probably in January. That will see the shares suppressed and go a bit lower in my view. And forget about black friday by the way. It may get rid of some of the stale stock ASOS holds but it's margins will be negligible.

ValueTrap: Please enlighten us all as to exactly when ASOS stock was quoted as being shorted up to 12% on short tracker. As far as I can see the shorts on ASOS haven't, as you say, 'reduced by 33% to about 8%'. They continue to hang around the 7.5% mark and have done so for a while. Even Boohoo hasn't reached those 12 % dizzy heights and are at 8.1% . I would be very worried if either stock had declared shorts over 10%. Both stocks are nevertheless the highest shorting stocks on the exchange.

ClaireSmith....regrettably the 'worst economic news' as you put it, has yet to come out. You're naive to think otherwise. The shorts aren't going anywhere at the moment. Perhaps it is best to wait on this share until after the next profit warning.

Trading4Good.

I respect your viewpoint but think you may be over-optimistic...... in my humble opinion.

Certain aspects which I touched upon before actually came from the horses mouth so to speak. I'll expand upon a few things below. So to say in generality that my comment was 'a load nonsense' I find bewildering.

For example, at the end of September Boohoo reported of a challenging consumer backdrop. They themselves admitted that they expected a revenue fall in the second half of the year after inflationary pressures, weakening consumer demand, 'substantially' higher return rates, and longer delivery times .

To emphasise the difficulty, the last update showed in Boohoo’s biggest market by revenue contribution, the UK sales were down as “the returns rate increased substantially”. Plus, rest of Europe sales were down slightly, and USA sales collapsed as extended delivery times across the Atlantic hit demand. I read in the last couple of weeks (I believe it was the IC) that insiders have said returns have actually increased further, although time will tell if the 'return charges' recently introduced will have the desired affect of slowing the returns down. Hopefully it will. (Asos too are having huge returns problems but have yet to introduce charges)

To put it mildly, the outlook short term (in my view 6 - 9 months) isn't very good at all given the company's own pessimism on consumer spending. And of course all of this was said by them well before the next 'spanner in the works' ...the Chancellor's Autumn Statement which will do sweet FA for consumer spending confidence. If anything common sense tells you it will put a further dent in fashion spending.

As I said before, since August they have been the most shorted London-listed stock, itself not a position that instils confidence. That's not nonsense either. It's fact and many of these shorters play the game very well and often know more than we do.

Numis analysts have noted that “a path to cash generation isn’t obvious” and concluded that “against today’s cost to serve, you wouldn’t invent the Boohoo proposition, and reinventing it doesn’t look easy”. So there's a lot of work to be done to rectify things. Hence why they think the short sellers are right. at the moment.

Trading4Good. I'll put a wager on that there will be a profit warning in Jan or Feb. I could of course be wrong but the way I see it, I'm more likely to be right.

There are some very embedded views on this forum, and some potentially a little optimistic.
Let us start with some reality points. The share is consistently the highest shorted share on the exchange. Perhaps people ought to reflect why that is. No matter what you think, while it is being shorted by such an extent the share price has little chance of advancing.
Then there is the question of the 'returns' dilemma that Boohoo has. Even with them instigating a returns charge, this is very expensive to manage. Insiders have calimed that about 30% of orders were being returned in the first half of the year, and it is thought that this has since increased after a downturn in the economy.
Then there is consumer spending which is forecast to reduce by approximately 7% over the next few months resulting in Jo public cutting down on fashion goods.
On top of that they are trying to expand into the USA, a notoriously difficult market to break, especially after the legal claims they have faced.
This share, in my opinion, is going to be flat for quite a while. Meanwhile Kamani contemplates whether to go private.

As I've said before, this share is being manipulated, particularly by the shorters who are going nowhere for a while. People here are wishing and praying that the recent rise is the start of an upward trend. Perhaps, but in my view not quite yet. It's still the second highest shorted stock on the exchange and most on the shorters list are experienced players. Retail shares generally have risen optimistically with the run up to Christmas. But many analysts believe that consumer spending will reduce following the recent interest rate rises and the stealth tax increase announcements today. Shorters are hanging on to the idea that profit warnings will appear in mid-Janauary, which coincidentally is when we get an Asos update. The shares may well drop at that point, but if Asos's new strategy is seen to be starting to work beyond that, then that will be the time to dip into these shares again. Meanwhile the MASH holding will hopefully bring recipricol benefits to both Frasers and Asos. A takeover is unlikey in my view because Asos is not on the verge of administration so Ashley will bide his time. If the company gets into difficulty he will pounce for a bargain. If the new Asos strategy works he will benefit through his 5% holding. He probably sees this as a win/win situation.

Joiningyou: Probably not best to post here but I'll answer briefly. A 'CVA' means the company is in severe financial difficulty and is in danger of bankruptcy. It probably can't adhere to the exchange's minimum financial requirements and is very likely to be delisted. In most scenarios you remain a shareholder at that stage. Your stockbroker would usually let you know of this and whether it holds any value. If the company exists but the shares are valueless in the eyes of the Stock Exchange/ HMRC, you can make a 'negligible value claim' to the HMRC and offset any loss against capital gains elsewhere. If a company is finally 'dissolved' (your stockbroker would usually tell you) you are no longer a shareholder. Shares can't exist if a company no longer exists.

To me it looks as though GAM are still in there. It's Exodus, Boothbay and Marble who reduced some of their short positions. It appears someone at GAM has played a blinder and may get a nice Xmas bonus. Selling 1.78m shares at about £6.45 on 26th and closing out today at a near low of £5.60 would have brought in a profit of over £1.5m quid in a couple of days. Nice work if you can get it. It will be interesting to see if they did indeed take any profits.

Ryanf......I appreciate your last comment this evening, thank you.

I fully admit to have been negative on the short term prospects (I believe fairly justfiably given the events this year as detailed in one of my comments on 20 October), and perhaps my gloomy comments on occasion have been irritating to others for which I apologise. I have however often basically said that I felt, on balance, provided nothing disastrous happens in this period of probable recession that the stock will eventually come good if one is prepared to wait a year or two.

Like maybe some on here, I have been constantly ''umming and ahhing'' over the last few months with regard to averaging down. I must admit I don't recall saying that I wouldn't buy at £5. I think I said earlier this month that if it went sub £5, I might tip my toes in again for one last time. As it happens, given the share response after the results, I honestly did buy at £5.36 on 20 October. In fact, despite my cautionary comment on 17th Sep, I had also bitten the bullet then and bought a smaller amount at £6.28 on 23 Sep to get a lower average, obviously hoping it wouldn't drop further or not that much. Yes, okay no need to call me a fool again!

I do still see a rocky road ahead. It's not just the gloomy retail figures that concern me or the potential cash call; it's the shorts who have somehow managed to manipulate this share all year. I know I said last time it would be the final average down, but if this does go to £5 again , I must say I'll be very tempted to do it one very very last time!

RyanF...I believe I've been fairly accurate in my comments this year. I find it bizarre that I am suddenly ''very wrong'' just because, for the first time in ages, the price has jumped a lot in one day. Yes I did say at the weekend I could see this drifting down a bit further in the short term. With the shorts still at 8% I still maintain that view barring a takeover approach.

Yes, I've averaged down recently, buying at £5.36. I felt at the time we were nearing the bottom, but after the results I made my comment about it probably going down a bit more merely because of ASOS's situation, the poor economic forecasts for retailers generally, and the increase in shorters to 8%. The MA interest, the Rishi factor, and the US news all coinciding has, in my view, bought some temporary enthusiasm to the retail sector. The fact remains the next six months are probably going to be dire for retail. Asos should get through this barring any further adverse revelations. I live in hope there will be a re-rating, hopefully by the spring as the market reads ahead.

Finally, there is no need to get abusive. Simply because you disagree with my comments doesn't warrant it. I am not ''this fool'' as you call me.

Presently up 17%....(Boohoo up 6.5%). Either it's a thin market (no obvious big deals from recent transactions) or maybe something going on behind the scenes. Can't believe this is solely to do with Sunak. Wish I'd averaged down a few days back now! I expected an initial jump yesterday after MA's added holding, but I must say I find today's rise surprising. I quite thought the shares would remain suppressed given the huge short positions.