RE: 60 pence4 Dec 2020 13:50
Hi all, Haven't posted on the boards for a few weeks after raising some concerns on another share and then getting attacked for doing that. This one has always been one of my favourites this year, its been a great year for ZOE. This hit as low as 3p in March. The projections I'm calculating have some great possibilities for this share. I'm just plucking out some hypothetical, but what i fell are realistic numbers. Anyone with more info on margins etc feel free to chip in. A few of the recent RNS's have been huge. Key points being..
190% growth from Sept to Oct in online sales.
Featured in GQ Magazine 2021 grooming awards.
Multiple awards for other beauty products
USA distribution with a partner with 88,000 stores to distribute to
EU Distribution
Lets take the GQ readership. 50m readers per month. Its the annual awards so we can assume that will be read by 50m. That's 50m that will now know the brand if they didn't already. I would suggest a lot of them will be new to ZOE/Chill.
If 10% of those visit the site thats 5m site visitors, if 10% of those buy thats 500k customers, even if its 1% that's 50k new customers to the online side of things. If its 500k customers spending say £35 that's £17,500,000 in sales, take the low 50k thats £1,750,000 in sales. We know ZOE's product is good and plenty here repeat buy so I would say the GQ feature will be a landmark moment in the companies growth.
Let's take the USA distribution roll out. 88,000 stores. Round it down to 80,000. So how much is likely to be made on the retail units?
Say £300 a months in sales, Of that £50 profit to ZOE, that represents about a 17% margin which is a lot lower than the online sales would be but takes into account the distribution and supply chains etc.
80,000 x 50 = 4m
4m x 12 months = 48m
48m divided by 196m shares in issue = earning per share of £0.244p
Times by 10 for a PE of 10 = £2.44 share price.
If those number could be £300 a week, £50 profit to ZOE, which is about 10 sales per week at £30. Not a lot to accomplish once the brand has really taken hold. These are the figures..
80,000 x 50 = 4m
4m x 50 weeks (account for holidays) = £200m PA profit.
£200m divided by 196m shares in issue = Earnings per share of £1.02
Time by ten for a PE of 10 = £10.20 share price.
Now that might be over optimistic on the 80,000 stores, but those numbers don't include online or EU so you can see this share is a real gem and the next few years here. Look very good indeed. GLA