Member Info for Thunder2040

Down over 7%..opportunity for the brave?

I think its also worth me reminding some of you on here, that net debt excluding IFRS 16 lease liabilities at 31 March 2020 was £896m down from prior year, and equating to 1.3x EBITDA. The quoted figure in some press articles of net debt being £3.3b is misleading in some respect. Capitalisation of operating lease liabilities is not that useful (its just an accounting requirement) as the future value derived from the assets is not on the balance sheet - so is best ignored tbh.

If they government continues to support the train/buses on a management fee basis, handling the operating exposure of those services, I think First Group cash generation will be quite good tbh.

The American divisions they are selling (apart from greyhound) include school bus runs that have fixed revenues, so the valuation of that particular division should remain pretty good IMO. based on the EBITDA multiples I would expect from a PE bid - the sale of those alone would possibly wipe out the debt in this company. 165p for each division even discounted heavily by say 50% still gives a hugely value accretive proposition for shareholders, no wonder there are such strong agitators onboard.

The going concern uncertainty comes from the risk of trying to operate the services at now 50% capacity without government assistance, which I see as highly unlikely given the rhetoric coming out of no.10. In fact the GWR trains franchise management agreement has already been agreed until middle of 2021..more will follow.

Its the uncrossing trade, so neither a buy or sell as such, rather the uncrossing price to max the volume.

I was trying to work out which is the better play here - this or Stagecoach. This is the bigger player with the racier assets but seems to have a bit less support from the brokers. Despite this, I think the asset sale could surprise to the upside - I am just surprised that it is not being factored into the share price.

I would predict bids might be on the table at the AGM - which is scheduled for about a week from now.

PYUECK - that was your opinion piece not facts. With the amount of interest there is, it is pretty clear the price for asset disposals will be pretty decent, and there is also a near term catalyst of the vaccine. So I really think you need to balance your view more.

When you have shorts involved often the price will plunge when they see an opportunity to facilitate volume sells and panic - the fact that this could only drop 3.5% today indicates to me that the shorts have burnt through a lot of their stock and moved the price next to nowhere, this is bullish.

Not sure what Odey thinks will happen here. The main thing is I think some are predicting a margin hit - as though the only way to make the clothes so cheap was to use sub min labour - its incorrect. The margin vs Asos for example is far superior because they make their own clothes and don't resell big brands as a wholesaler - where margins are crap tbh. They add value through fashion design and have a slick marketing team. Consensus is for sales to be up 19% this year - personally I think it could do closer to 40%. Additionally there is increasing international diversity here (50% of sales non UK), I suspect the supply chain in USA is not impacted by Leicester - so we could hypothesise that its an issue impacting perhaps only part of the company - I think that should have been made a lot clearer by management.

Hold for the interims and you will be rewarded.

Cash will be burnt in no time, massive dilution...thats why this has come down. Basically your shares will be worth half of what they were..20p is the new 40l etc.

What are these angry journalists and the like actually trying to achieve here? Shall we move all the jobs abroad, or perhaps just bring Boohoo down completely, yeah that will be great for the UK and UK economy. The one time we actually manufacturer something in this country we almost seem to want to shoot ourselves in the foot and ruin in.

Why can't the attitude be more constructive like, we recognise that Boohoo is a young, growing UK firm, employing lots of people, actually doing well in a pandemic - lets work with them and support them?

All the while we have a regulator in the FCA that sees no coincidence that Odey opened a short days before yet another scaremongering article was released. It was released late on a Friday afternoon when volumes are thin to cause maximum panic in the share price.

Best thing to do is this - sit tight and wait for trading update on the 5th - where there will be no talk of this stupid investigation, just massive global sales growth, continued market share increase and consistent profit.

Odey's recent track record is poor, he got badly burnt on Tesla, another stock that looked over valued and has since quadrupled.

https://www.google.com/amp/s/www.bloomberg.com/amp/news/articles/2020-07-08/crispin-odey-hedge-fund-s-losses-deepen-to-17-9-in-first-half

I would even say its bullish that he is short here now, trading statement early Sept will show stellar sales growth and the shorts will be wounded badly IMO

I am going to just come out and say it - they have not got a grasp of this business sector and their broker ratings on Asos/Boohoo are just embarrassing. I think they called for Asos to be struggling this quarter just gone. Broker ratings are not worth the paper they are written on at the moment.

You don't have a clue what you are talking about I am afraid.

Richox - take a step back and try and value the business. Its cheap on current p/e and is highly defensive in a growth sector. Doesn't matter what you think about the system or anything else, you buy this now, you sell it in 1-2 years and you make big money.

The proof is in the pudding anyway Mr, Jones, money is where my mouth is, as I expect yours is if you are short, first to 50% wins ;)

5g and fibre network is the future if you cant see that its a lost cause explaining the rest to you.

Do you understand leveraged companies return on equity ThJones? Have you done a discounted cashflow valuation based on future dividends/ profit distributions at historical levels? Do you understand why the Directors just scooped up a load of shares at this price? Your comments suggest you do not haha. You buy low, you buy now!

Position opened, p/e ratio decent, defensive qualities, director buys and involved in the future telecomms infrastructure that will power the work from home digital revolution through Openreach...only key risk I have discounted my target for is the Huawei hardware debacle, but I expect government to fork out for some of that!

That is true to some extent, but take a look at the p/e ratio here..crazy low, for a business that should have relatively stable cashflow for a long time. The loss was due to exceptional items, with the cash generation strong they can pay down debt to improve the margin. We also know there is likely no national lockdown in H2 but still expectation of higher death rates - which to me means more full cost funerals on the horizon. Director buying and large short to close - this is only going up short term IMO.

Looking at those interim results, I am struggling to see why this has gone down so much during the covid crisis, surely now a rerate back to pre crises level is on the cards!?

For me the lack of forecast sales change says it all..this is going up because of that IMO