The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
Part of the issue is that we've all seen shares - particularly in the USA but here too - where a full recovery from the pandemic is already priced in. Many shares are at all-time highs, as if the pandemic never happened - and this isn't just stocks that obviously benefitted from lockdown.
Look at BOOT (Boot Barn Holdings Inc), a company that sells cowboy boots in mostly brick-and-mortar stores - currently up 42% from its pre-pandemic high, which was itself an ATH, and now trading at a PE of 47 (I use BOOT as an example because I got in as a recovery play at the start of the pandemic, then sold out when it recovered to the pre-pandemic price - only to be left scratching my head at the inexplicable 42% additional gains I missed out on).
Anyway, my point is that we are aware that this is happening and kind of want it to happen for NEX - so a SP > 400 - but for whatever reason it hasn't happened. The current price actually does reflect some of the continuing uncertainty of our current situation - variants, additional waves, vaccine supply issues etc etc, and as such is, I believe, a more fair and reasonable price, even though of course I would prefer the price to have the same reckless optimism as BOOT!
Can we please stop attacking those who have negative opinions about these shares? Otherwise these forums will just turn into a useless echo chamber where nothing is challenged.
I think Gallmat makes a good point. As he says, the pre-pandemic price adjusted for the new shares is ~400 (this is actually quite generous, using the absolute peak price of ~480p in Dec 2019).
So the current price (after today's drop) is down ~27% from the decade-high of 480. Is that fair?
- the UK - with it's advanced vaccine program - is still months away from fully opening up
- ...and we've just learnt that our vaccination program will be set back by about a month by supply issues
- other countries will be further behind
- no dividend; given the above it may be a while until there is a dividend
I am still long NEX. I think it's a great company with great fundamentals, well run, and I believe the story that they have been able to pick up contracts due to the pandemic and will - eventually - come out of it stronger than before.
But it has a long way to go and, given the unknowns and the difficult road ahead, I don't think the price right now makes it a "slam dunk" investment, and I think calling someone who expresses opinions similar to this an "idiot" or a "troll" is not just rude, but foolish.
FWIW I use Interactive Investors and generally haven't had any problem buying at any point in the last month or so.
I see a lot of chatter on this forum about MMs "manipulating" the price of LOOP and I'd love to understand more about how exactly that might work.
Is the idea that the MMs are holding a huge amount of this stock and selling it off below "fair value"?
To what end would they be doing this?
If they ever have to "top up" their stockpile, presumably that means buying it from sellers willing to sell at the current price - and if there are enough of those sellers to allow the MMs to keep this up for so long, doesn't that imply that this is indeed the "fair" price?
Also, I find it a bit suspicious that this supposed manipulation is happening at the same time as management is being curiously coy about giving any updates, which is also clearly puzzling many people on this board. Could it just be that market insiders know more than we do, and there's a good reason why this isn't trading any higher?
Not trying to disparage any theories, just genuinely trying to understand the thoughts here!
Thanks