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"Redde tables at 1.4 billion pound bid which the Halfords board said significantly undervalued their company".
You are using the merged market cap of two companies (Halfords and Redde) to extrapolate a value for one of them (Halfords). Halfords has a market cap of £343m because that's what the market currently thinks it is worth. Note that HFD's market cap is less than 1/2 what it was 2 years ago. If you have low and falling margins in a tough sector this is what you get. Valuing a company on a possible future takeover is like buying lottery tickets and holing your breath.
Halfords has fallen over every main time period. 1d, 5d, 1m, 6m, ytd, 1y, 5y, and since 2004. Is it possible that they need a different management team?
Now in 10 th most shorted stock.
In six years Graham Stapleton has been paid received something like £6m plus of salary, share options etc. He recruited his cronies from previous roles, and in that time the share price has been on a downward trajectory and underperformed against any reasonable benchmark. He has issued stock at high prices and continued to acquire new business and is now working out what to do. The market speaks.
At this rate is will be in the list of the top 10 shorted stocks. I'm surprised the Chair and CEO and making new appointments. The div cover and op margin have halved. Scary stuff.
If you take the 12 most shorted stocks in the UK half of them are retailers of some form.
Now 3% shorted. In a list of the most heavily shorted stocks in the UK. Any idea why?
As with previous announcements, there is a possibility that some of this profit downgrade relates to an acquisition. Hard to see how you get such a big fall in 4 weeks. Institutions don't like this sort of stuff.
Just over 10% of rooms are in Germany. Bad German inflation numbers aren't behind this price fall.
If you look at the last 3 year history of director buys, there isn't much to be encouraged by!
It seems odd to be doing a buy back if the numbers are off.
A stock with this market cap doesn't fall like this without a reason.
I was wondering the same thing. Possibly a less than positive broker note.
You are missing the point. It wasn't a £1.4bn bid for Halfords. It was a merger of two low pe, low growth stocks.
"The bid in November was 1.4 Billion and the board stated that it undervalued the company. The Mcap is now 330 Million, ridiculously undervalued".
Just to recap.... the so called "takeover" rumour wasn't a "takeover". It was a possible merger between two poorly performing, low PE stocks. It was all paper.
this is an interesting case study in how analysts sometimes spend far too long listening to management and reading financial reports and ignore the basics. i bet not one of them got off their ****s and wandered around a good sample of service centers and retail stores. the analysts for this stock have been dire.
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https://www.ft.com/content/69a72597-0bf8-492f-895f-c634e99af068
From the FT
Russ Mould, investment director at AJ Bell, said the updated guidance meant “Halfords has gone back to days of old where it would regularly disappoint with earnings guidance and always have some excuse as to why its business is not running smoothly”.
For a mass market operator Evans are streets ahead of Halfords. Bikes are now relatively small beer for Halfords but a big chunk of retail costs and footprint. My biggest issue with Halfords on bikes is that it has been very clear for a 3-4 years that they are doing a bad job and they haven't done anything to address it. Go check out their instore approach to bikes. They have assumed that a better website would reduce costs and drive sales. Their website is actually now pretty dated and pretty clunky.
My post from 29/11. Hard to be optimistic on this one.
Institutions really don't like restatements. £10.6m revision is not insignificant. Also note the delay in releasing accounts which suggests some tooing and frooing with auditors. If you go into a Halfords store and look at what they are doing with bikes and then compare with a good bike retailer (Evans et al) it is very obvious why they are failing in this sector. They are dire. Their retail footprint dedicates so much space to an area where they are performing badly. I'm a big fan and customer of their auto centers. They haven't updated their advice on labour recruitment challenges so assume this is still a problem. Investors will look at this and wonder where they can increase margins. They can't rely on investors stumping up cash to buy market share when margins are looking so thin.
It was an all paper merger.