The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
**** the charts. 46% of this businesses production is UNHEDGED. Oil is 100+ and gas nearly 300p a therm.
The opex per barrel is $16. Do the maths.
Don’t moan you sold out. Just get back in. This has plants more in the tank. On a daily basis it is gonna generate a **** load of cash thus reducing net debt (thus creating equity value at constant EV multiples. But ask yourself what the medium term game is? We have enough reserves for almost 8 years of production. They will replace that but M&A in my opinion. BIG M&A!!!
Buy the stock. Park it away. Go Kip. Wake up double your money in 12-18 months with pretty much zero downside risk.
That’s just a move tho try strengthen his currency which has become worthless. Ruble rallied a bit since but won’t make any diff. Russian economy will be torched inside 6 months. Enjoy queuing for bread, puta.
Held a round table with management and institutional investors this week post results. They addressed some very specific concerns and points re the cost base, margin evolution, esg, marketing spend, the distribution centres etc. stifel put a report out on it today and was very reassuring.
Let me help you out….
2021 FCF higher than forecast
Tolmount start up underway. It’s not just a case of turning a switch on. It’s not like your central heating.
Stated that in current commodity price environment they will be debt free next year!!!!
Confirmed reserves of 488mboe which is probably 7 years.
Stated will seek agm resolution to repurchase stock from free cash flow.
What more do you want?
Not so much they have to notify of a takeover at 30% but they have to make a mandatory takeover for the company at the highest price paid over the preceding 12 months.
I think that v important for ncyt if bio were interested in a full takeover. The share price is so low they are incentivised to buy as much ch as they can as quick as they can. Personally I would not be surprised if they went to 25% as they can then block any resolution proposed by the board they dont like to manage their investment.
Barclays: Overall, the brief trading update is fairly uneventful and we look to FY results on 4th May for more colour on the FY23 outlook. There is little incrementally new here – returns remain high as product mix normalizes, and international delivery times continue to impact. We still think there is downside to FY23 numbers, but there is little to change the debate in either direction today. We are UW Boohoo as we think it can continue to grow, but 1) short term it faces the most severe headwinds of peers (especially its international business), and 2) longer term, growth will come at a higher cost than MT guidance implies. Headline multiples look cheap at ~9x EV/EBITDA+1 but we see risks to estimates (they could get worse before they get better) and model –ve FCF for several years while capex is higher.
Jefferies: Jefferies analyst Andrew Wade says pressures facing co. are almost entirely transitory, rather than structural. Shares will end up having looked very cheap at these levels; looks for them to “regain some ground” today
Liberum: While we continue to believe in boohoo’s long-term potential and see a path for recovery to the medium-term growth targets it will be a long road. On valuation ground we are a Buy, but as a team we were torn with near term catalysts absent. Trading at only 0.4x 12m forward EV/sales (vs. 2.5x pre[1]pandemic) and 6x EV/EBITDA, we think the shares offer good long-term value. While current growth and margin dynamics suggest rating on boohoo should be HOLD, we think the shares look oversold and hence remain a BUY. To justify the current share price, we will have to model in our DCF that EBITDA margin remains in the 6-8% range permanently with sales growth at a 12% CAGR over next 5 years vs. the company targets of 9.5-10% EBITDA margin and 20-25% growth in the medium term.
Analyst snippets coming out this morning…
Stifel: boohoo's 4Q trading update should reassure investors as FY22 sales growth of 14% was in line with guidance and FY22 EBITDA is also in line with consensus estimates at £125m(and 7% above our more cautious £117m). Whilst no guidance is given on FY23E yet, management has reiterated that it sees pandemic-related headwinds (on costs) as short term, and investors can be also reassured that RoW sales returned to growth in 4Q due to a positive contribution from wholesale. In the geopolitical unrest and market turmoil, boohoo's share price has fallen to just 79p and now trades on only 10.7x our cautiously-set cal. '22 EV/EBITDA and 6.1x cal. '23 EV/EBITDA. We think this de-rating is overdone and reiterate our Buy rating and 200p target price
JP Morgan: : Overall, this is a reassuring statement from boohoo in the context of materially reduced forecasts post the group’s profit warning in Dec. H2 sales to end Feb are at the upper end of reduced guidance (with the 3 mths to end Feb +7% yoy, slowing as expected vs. +10% in the 3mths to end Nov). FY 22 EBITDA is expected to come in at £125m, in line with BBG consensus and the mid-point of guidance (albeit suggesting slightly more margin pressure given sales at the upper end of the expected H2 range). No outlook has been provided and we therefore assume that comments made in Dec (for FY 23 sales and for EBITDA margin to be broadly in line with H2 22 levels) still stand. We expect consensus to remain broadly unchanged post the update. The shares rallied strongly yesterday (+13%), which could subdue any move today, but given the discounted valuation, and lack of further downgrades, the statement could send them at least somewhat higher.
… they e used assumptions on the price deck for U.K. gas to 250p a therm for 2022, 160p for 2023, 120p for 2024 and long term assumption at 70p.
The result?
They just increased Serica price target to 540p.
Cha ching.
Top line may be fine backward looking. But I think the concern with retail at the moment is the impact of a significant squeeze. Consumer being hammered by highest cost of food, petrol, electric etc and at same time boo being hammered by inflation in input costs, wages, energy, logistics etc. retail margins already thin so may take a hit.
I am long however, and will add again in new tax year as all the above are always transitory. I like good companies with good balance sheets with leading positions. This biz will come out way way stronger and weaker brick and mortar retail will Continue to fold.
Never mind oil. That’s now a rounding error for HBR in the overall business. The U.K. Nat gas spot just went through 800p a therm. That’s plus 74% today and in $ bbl equivalence to oil it’s $ 618bbl.
The gas business at hbr is approx annual production of maybe 40m boe in gas of which 60% is hedged much lower. But the 40% unhedged portion of the gas biz is currently making more money than the entire oil business (50% of total
Production) and the hedged part of the gas biz……combined!!!!