Member Info for TysonX

Interesting how several factors now seem to be aligning at the same time.

Ex-dividend tomorrow, AGM next week, no disclosed shorts remaining above the reporting threshold, buyback authority expected to be renewed and recent trading volume has been significantly above average.

For the first time in a while, it feels as though both the technical backdrop and the fundamental backdrop are beginning to point in the same direction.

What makes it even more interesting is that the shares are still trading at a substantial discount to most published broker valuations.

Markets rarely wait for full confirmation before moving. In reality, markets tend to price probability rather than certainty.

The market already knows about the weak FY26 start, the forecast cuts and the loss of confidence. Those issues are hardly a secret and have already been reflected in the SP.

The more important question now is whether the future turns out to be better than currently feared.

With the ex-dividend date approaching, the AGM shortly afterwards, buyback authority expected to be renewed, disclosed shorts now gone from ShortTracker and management still guiding towards an H2 recovery, it may not take full verification for sentiment to continue improving from here.

IMHO, the risk/reward here remains heavily skewed to the upside.

The market appears to be pricing in a lot of bad news already, while the fundamentals and recovery potential remain easy to overlook.

With no disclosed shorts remaining above the reporting threshold, and as highlighted by others, a debt free balance sheet, strong cash generation, an attractive dividend and ongoing international expansion, I continue to believe the market may be underestimating the long-term opportunity here.

“}

Still looks massively undervalued to me based on forward fundamentals.

Debt free, cash generative, improving margins, ~8% yield, Rossmann Germany rollout, stronger Walmart orders and expanding global distribution.

If H2 recovery materialises, I struggle to see why this should still be trading at these levels longer term.

Some of the macro fears being discussed here seem a bit overstated to me.

Higher freight, energy and input costs are not unique to W7L — every cosmetics/import-led brand faces the same backdrop. The difference is that Warpaint has already shown previously that it can protect margins through pricing, sourcing flexibility and scale efficiencies.

Importantly, cosmetics are also relatively high-margin, low-weight products, so freight/logistics costs are not as structurally damaging as in many other sectors.

What also stands out to me is that despite all the doom posts:

gross margins still improved to 42.6%

cash rose to £16m+

the business remains debt free

dividend increased 20%

short interest has actually reduced materially over time rather than increased

Meanwhile operationally the company is still expanding:

Rossmann Germany rollout

stronger Walmart orders

Barry M integration

India/South America launches

Clearly the weak FY26 start hurt sentiment badly. But the current valuation already seems to assume long-term stagnation rather than temporary weakness during a difficult macro period.

Key point:

➡️ This was NOT another profit warning.

Despite:

• US tariff chaos

• Bodycare collapse

• weak consumer backdrop

• FX hit

W7L still delivered:

✅ RECORD revenue £105m

✅ Gross margin UP again to 42.6%

✅ Cash DOUBLED to £16m

✅ NO DEBT

✅ Strong cash generation

✅ Online sales +38%

✅ Walmart orders improving

✅ Rossmann Germany rollout into 2,200 stores

✅ Barry M acquisition

✅ April 2026 already ahead of April 2025

✅ “Signs of recovery” explicitly mentioned

And MOST importantly:

✅ Final dividend INCREASED from 7.5p to 9p

✅ Total dividend now 13p

Companies expecting disaster do NOT raise dividends by ~20%.

To me this looks far more like:

➡️ “2025 trough year + H2 recovery setup”

than a broken business.

At sub-190p:

• huge yield

• debt free

• improving margins

• strong brands

• expanding distribution

Feels like fear/exhaustion selling into results rather than fundamentals collapsing

Worth noting that those cost pressures are not unique to Warpaint. Every cosmetics importer and brand selling into the same retail channels faces the same environment. Historically companies in this sector have managed this through pricing adjustments, sourcing flexibility and margin management, and Warpaint has already demonstrated this capability previously.

Second, cosmetics are high-margin, low-weight products, meaning freight and packaging typically represent only a relatively small portion of the overall cost base. Even when shipping costs rose sharply during the pandemic, the sector generally managed through it without structural damage to profitability.

Third, if these pressures were expected to materially damage profits, you would normally expect to see short positions increasing rather than reducing. In reality the disclosure data shows the opposite trend, with JPM cutting its short repeatedly from around ~1.7% down to roughly ~0.4% (amongst others) and overall disclosed short interest now very small.

Meanwhile the company has:

• strengthened its brand portfolio through the Barry M acquisition

• guided to a return to organic growth in 2026

• indicated further significant customer rollouts to be discussed at the April results

So while macro volatility may move the share price in the short term, the underlying business drivers remain intact.

It’s also worth noting that the shares are already trading well below historic valuation levels despite the balance sheet remaining strong and growth catalysts approaching, which suggests a good deal of macro uncertainty may already be reflected in the price.

On that basis it’s far from obvious that profit revisions are coming, and the current weakness looks more like macro noise rather than a deterioration in fundamentals.

Short interest here continues to fall away.

According to ShortTracker, JPM has now reduced its declared short position repeatedly since December, cutting from roughly ~1.7% down to around ~0.4%. That’s a very material reduction in a relatively short period of time. Once a position drops below 0.5% it disappears from the disclosure list, so JPM is effectively now close to being fully out.

Arrowstreet remains around ~0.59%, but overall disclosed short interest in W7L is now very small.

The key point is that when a large short position is systematically reduced step-by-step, it usually suggests the risk/reward of the short thesis is deteriorating.

At the same time the company has:

• strengthened its brand portfolio through the Barry M acquisition

• guided to a return to organic growth in 2026

• indicated further significant customer rollouts to be discussed at the April results

Meanwhile the shares remain well below historic levels, despite the balance sheet remaining strong and the business continuing to expand distribution.

With shorts reducing exposure, institutions adding, and multiple catalysts ahead (April results followed by the June trading update / AGM), the current volatility increasingly looks like macro noise rather than a change in the underlying investment case.

In my view the market is still very much underestimating the recovery potential here.

https://shorttracker.co.uk/company/GB00BYMF3676/

Price volatility over the past few sessions doesn’t change the bigger picture here.

We’ve come from 175p panic lows to 279p in a matter of weeks — that doesn’t happen in broken businesses. Pullbacks after a 60% move are normal, especially in a thin AIM name where momentum traders rotate quickly.

What matters is structure and fundamentals:

• The business is debt-free with net cash.

• Barry M was acquired at a highly attractive entry price, adding 1,300+ retail locations with zero liabilities.

• Brand Architekts was turned profitable in year one.

• Management has guided to a return to organic growth in 2026.

• Further significant customer rollouts are expected to be updated at the April results.

Meanwhile, short interest has been reducing and institutions such as Schroders have increased exposure — that combination is typically seen during early-stage re-ratings, not late-stage tops.

Technically, we’re consolidating after a sharp breakout from the 200–230 base. That base was built over weeks; it won’t unravel in a few volatile sessions unless something fundamentally changes — and nothing has.

The market often tests conviction before the next leg higher.

April results will be the real inflection point. Until then, this looks like digestion of gains — not deterioration of outlook.

Very important macro development that directly strengthens the recovery case here.

Warpaint explicitly confirmed in its own trading update that US tariff uncertainty negatively impacted momentum and cost the business revenue during 2025. That was not a structural demand issue, it was uncertainty-driven.

The recent US Supreme Court ruling limiting unpredictable tariff escalation materially reduces the risk of sudden trade disruptions. This improves visibility for distributors, supports restocking behaviour, and removes a key overhang that had been weighing on US expansion.

Warpaint’s asset-light, outsourced manufacturing model and global distribution footprint mean greater trade stability directly supports margin recovery, order flow and the return to organic growth which is exactly what management has already guided for 2026.

This comes at the same time as the highly attractive Barry M acquisition, securing a well-established brand with 1,300+ retail locations for just £1.4m with no liabilities, and with management also guiding to further significant new customer rollouts at the April results.

Meanwhile, shorts continue to reduce exposure and institutions such as Schroders have increased positions, signalling growing confidence at these lowball levels.

With tariff uncertainty easing, margins recovering, distribution expanding, and expectations still reset well below historic levels, the recovery and re-rating case now very much continues to strengthen.

The market has yet hardly priced in the structural improvement in outlook.

Once again, two sizeable late-afternoon prints went through today, clear evidence of meaningful interest at these levels.

Agreed! The rally here hasn’t even started yet. After a heavy de-rating on well-understood issues and expectations now firmly reset, the downside looks increasingly limited from these levels. With balance sheet strength intact and growth set to normalise, the upside from any stabilisation or re-rating appears to materially outweigh the risks, in my view.

It’s true they came in slightly below the top end of the interim ranges, but that was already heavily telegraphed at H1 and hasn’t worsened since. The key positive for me is that there were no new negatives beyond what was already disclosed, and H2 executed as planned with improved margins and full rollout delivery.

On EBITDA, ~£22m versus the £23.5–25.5m range reflects the same clearly-quantified one-offs (Bodycare, macro softness, US tariffs). Importantly, Brand Architekts swung from a loss to a profit in year one, which offsets some of that drag and supports the FY26 recovery case.

Looking forward, management are now explicitly guiding to a return to organic growth, with further major rollouts to be announced at the April results, plus the Barry M acquisition adds a meaningful new revenue stream at a very modest price. Against that backdrop, consensus EBITDA moving back towards £25m+ in FY26 doesn’t look a stretch.

After such a sharp de-rating, the market was pricing in a lot worse. This update removes downside uncertainty and adds growth optionality — which is why it reads better than the headline “miss” suggests.

Wide and inconsistent spreads across brokers are a market-maker liquidity issue, not a reflection of the underlying business. AIM stocks frequently show this behaviour ahead of updates as MMs manage inventory and risk — particularly when stock is being absorbed and liquidity tightens.

It’s also worth remembering that infrequent updates are normal on AIM. Companies are only required to communicate when information becomes price-sensitive. The fact that there has been no warning while we move through this window is far more telling than the absence of routine commentary.

In short, the spread is signalling positioning and caution by market makers, not deteriorating fundamentals. That often precedes resolution — and when uncertainty clears, pricing can adjust very quickly.

Promotional pressure typically hurts premium brands more than value. W7L already operates at accessible price points and has historically gained share when consumers trade down, which is exactly the environment we’re in.

UK softness was clearly flagged by W7L at H1, which is why expectations and the share price were reset so aggressively. The bar for H2 is therefore much lower. If trading simply stabilises versus those reduced expectations — let alone shows any improvement — the scope for re-rating from these levels is significant.

On key metrics — valuation, balance sheet strength, margins and yield — W7L now screens as materially undervalued relative to its own history and peers.

The business remains debt-free, profitable and cash-generative, with a covered dividend, while the share price reflects a much more pessimistic outcome than current fundamentals imply.

Recent price and volume behaviour suggests selling pressure has eased and longer-term buyers may be accumulating quietly. If trading stabilises versus already-lowered expectations, the scope for recovery appears meaningful from these levels.

Down day today, but again on light volume. Yesterday showed interest (albeit on higher trading volumes), not a finished move. In stocks this thin, patience usually matters far more than the daily close.

Personally, I remain very optimistic here given the fundamentals (debt-free, cash-generative, extremely high insider ownership, covered dividends, and especially the CEO’s recent comments that the recent issues were largely one-offs, not structural), DYOR.

ShortTracker now shows total disclosed short interest at ~2.30%, down from ~2.9% previously. Spark have reduced below 0.5%, meaning they no longer appear on the public register.

This is exactly the type of behaviour we would expect if the short pressure was quant/trend-based rather than a fundamental short thesis. When trend weakens, they quietly scale down and disappear from the register — and that’s what’s happening.

With management owning ~40%, zero debt, rising cash, strong margins and a covered dividend, it was only a matter of time before shorts started easing. If we start seeing any further reductions (or volume pickup), the setup for a reversal gets even more interesting — short covering + low liquidity can move this one very quickly.

Slowly but surely, the spring is coiling.

https://shorttracker.co.uk/company/GB00BYMF3676/

W7L directors have bought in the past after weakness, and they own a very large chunk of the company already (~40%+ including all directors/insiders).

You’re right that W7L isn’t on every shelf in Boots, Superdrug…. – and that’s actually intentional, not a limitation.

W7L doesn’t chase blanket listings.

The strategy is selective, high-rotation placement, typically:

• Front-of-store impulse bays

• Seasonal end-cap & promotional displays

• Linked make-up + skincare stands

• Value-tier cosmetics zones in Tesco & Asda

This achieves:

• Faster stock turnover (less write-downs/returns)

• Prime visibility instead of dead shelf space

• Higher margins since they don’t pay for full-chain coverage

A useful comparison:

REVB has broader Boots/UK retail presence — and yet is loss-making, partly because nationwide listings are expensive.

W7L focuses only on locations where products sell quickly, not where they simply sit.

Also, the growth story isn’t just UK high street:

• Tesco & Asda rollout continues to expand

• China, UAE & EU distribution are scaling

• Amazon + TikTok Shop are now meaningful channels

So yes — you won’t see W7L everywhere.

That’s the model: be where products move fastest and margins are strongest.

And the results back it up:

• Revenue growing

• Gross margins held

• Net cash increasing

• No debt

• Dividend intact

This is disciplined, profitable distribution — not overreach.

The story isn’t “lack of presence.”

It’s profitable presence.