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That's true Roger...if you don't buy it at some point...disappointment is inevitable:)
Hi Birmanboy,
I don't think people are saying that WHS will go down the drain (well, not anytime soon) ... and I agree, if they don't go down, than at some stage they are likely to come up again. However - looking at the consistent drop in NPAT, looking at the hardly moving sales numbers, recognising that they don't seem to manage to fix their well known problems, looking at the consistent SP down trend and looking at the indicators ... why do you think it is a good idea to buy WHS shares now?
true - but only, if they are able to keep paying their dividends, otherwise the yield is tanking as well. Unless they have in the second half an amazing turnaround in earnings, their promised divvies will be higher than their earnings. How do you think they are going to fund that?
Well then, the Oracle could be right or a guy on the internet called Hoop could be right.
I think you may find that Mr Buffet would not have regarded WHS as undervalued in 2009, it’s about fundamentals and value not where the share price is, or if it has just dropped or risen. Stock picking is everything.
Buffett style ‘ buy and hold’ investing as you refer to it as, has created the world’s most wealthy people. Couldn't name a single TA billionaire off the top of my head though.
Well I would hold off buying into a downtrend, even if the yield is improving. Just my 2 cents.
I would have thought the drop in petrol price would have materially assisted the disposable income of the typical WHS customer ?
We should be very impressed with WHS. Given what a shambles the stores are, how poor their reputation is (my kiwi girlfriend often recites "The Warehouse, where everything you buy is broken.") and how tough retail has been they've done quite well.
That's sort of the value proposition here isn't it? This is still a company that could still be turned around relatively quickly.
Whom may predict what an oracle may think. I don't hold or research WHS, so it wouldn't be thus fair to make any comment on WHS valuation, in respect for holders.
I wish you well and hope you prosper Moosie, you may be young enough to get there at careers end, perhaps philanthropy will suit you too. I’d rebuild the cathedral if $67M became loose change, each to their own.
Be interesting to see how long they can maintain current dividend with margin and profits falling
The SP drop seems to be flattening out somewhat although the buyers appear to be losing interest a little or at least waiting for a bottom. Could be still some ways to go.
http://www.reuters.com/finance/stock...?symbol=WHS.NZ
4 analysts have downgraded WHS in the last week.
Now only 1 hold, 4 under-perform ratings and 1 sell rating.
Consensus EPS for 2015 is only 16.54 cps.
At $2.70 with the track record of this company the market is presently saying its worth a forward PE of 16.3 times 2015 earnings.
I can totally relate to why analysts have their current ratings.
Very interesting to compare WHS with Kathmandu which recently announced a slowing in the rate of sales growth.
KMD consensus eps for 2015 according to Reuters is 19.29 cps and their SP closed today at $1.90. This gives a 2015 PE of 9.85 with their, (in my opinion), better track record.
Consensus analyst view on KMD is outperform.
If we applied the same 9.85 PE multiple to WHS we'd be looking at a SP of only $1.63 :eek2:
Room for substantial further deterioration in WHS's SP ?... you be the judge.
Disc, don't own either stock at present...might be interested in KMD after it stops dropping.
It's a nasty business and I do respect your comments Roger. Still, I'll just hang on in there as I always do. I have a "responsible" amount of WHS in the context of my overall net worth so I'm not in the same position as I was with Chorus. In other words, I'm sleeping at night, it still hurts nonetheless ;)
I do like the WHS, I never buy a company I don't like, and I did buy an excellent watch from the Warehouse's website this morning. It was featured on it's daily Red Alert sale. Despite what some people believe, the Warehouse parallel imports some top brands. The watch is a G-shock GW1000 Aviation model. It cost $499. The best (and I mean the absolute best) price I could have got from Amazon was $529NZ. The best price from NZwatches? $609. How about Christies Jewellers in your local mall? $750.
I'm so excited about my purchase. Here's a review of the watch if you're interested. It won't be to everyone's tastes but it is to mine. Just a pity we don't have an atomic clocks in NZ to calibrate the time "Multi-Band Atomic Timekeeping (US, UK, Germany, Japan, China) Receives time calibration radio signals which keep the displayed time accurate"
http://www.ablogtowatch.com/casio-g-...-watch-review/
Such is the fickle nature of retail it would only take one good sales period to send the price back over $3 much the same as Sum aye Roger, its a scary coincidence that you valued Sum at $1.63 a while back and now the Warehouse, obviously I have to disagree with you on this stock also but no offence mate:cool: Disc- Holding at $3.27 buy in price.
The big difference between KMD and WHS is their growth strategy.
1. KMD expands their single brand into new territories (AUS/UK)
2. WHS acquires new brands in a single territory (NZ). Peter Lynch would call this "deworsification"
So for this reason , I'm with you Roger. While I don't own either, I'd prefer exposure to KMD at a pe=10, than WHS at a pe=10 (now 16).
Couta. What was your reason for buying WHS? Does that reason still hold valid?
Noodles I bought WHS as a divvy stock so that reason still holds valid plus I like the company:cool: Also hold KMD.
No offence taken but I would however point out that I haven't valued WHS per se, I'm just making the comparative observation against where the market is presently valuing KMD. I'll leave it for others to decide where they see fair value for WHS but at least you all know where the analysts are presently sitting and which stock I think is more reasonably valued / prefer, (see comment below)
You're on to it mate and I agree 100% with what you've said. I also think KMD is a better play in terms of their adventure / outdoor range of products playing into the tidal wave of comfortably well off baby boomers looking to get back to nature / engage in healthy activities. Further I don't think its a tired brand like WHS is. Perhaps we can continue discussing on the KMD thread, (not my intention to annoy WHS shareholders), as I'm not sure I want to have any exposure at all to retail but KMD is starting to look attractive.
looks like going to test lows around 2.50 soon
Agreed. Also looking extremely oversold as well. Ripe for a bounce back up a bit? Got any names for the dead kitty it will spawn?
http://www.bigcharts.com/advchart/fr...false&state=15
http://www.bigcharts.com/advchart/fr...e=15&x=38&y=11
not quite so oversold on the weekly, also i think they may have to cut div at some stage
And such is the fickle nature of retail one bad sales period will send this stock down to $2. It beyond belief why anyone would consider this undervalued in the current retail climate with a forward P/E of approx 15 in an declining sector. Enough said. Far better stocks out there trading at cheap P/Es with better dividend yields particularly on the ASX.
I hope the Normans did not buy on margin!
And such is the nature of the share market, anyone who thinks any stock is safe is in dream land to a certain extent the whole thing could turn to custard in quick time with certain world events occurring such as a major war in the middle east, such is the nature of the beast we entertain:cool: PS- I dont do ASX only NZX
Extremely oversold near term and resistance to selling below $2.60 with thin asks now. I'm in fir a dead kitty bounce :)
Anything less than 250 will be a price not seen since last century
Still trading as a matter of fact......changed the name to Farmers...and it was 2001 which is 14 years. However since this is not an exercise in pedantic narcissism, there is an element of truth in that the Normans (who own Farmers) are a major shareholders in WHS. Now how's that for truth is stranger than fiction!!
Deka was the old McKenzies
The Warehouse killed Deka
wiki says several Deka stores were rebranded Farmers, including 6 in the South Island
http://en.m.wikipedia.org/wiki/DEKA_(New_Zealand)
I'm afraid to admit that I remember shopping in McKenzies......may God have mercy on my soul. The names may change but the buildings and type of business live on providing employment for countless Kiwis. Leading me to the point that WHS isn't going anywhere and is probably positioned more favourably to handle occasional drops in business. Dare I say it better than Kathmandu, Briscoes, Hallenstein Glassons etc. Anyway as W69 points out the SP is reaching a place of "interest". So has Moosie picked the POMBP (point of maximized bottom picking), or is 2.50 just a few days away.
If you walk into most Whitcoulls stores currently, you'll see a big stash of "Farmers" books, a written history of the business, in the bargain bin for $10 each. I bought one and found it interesting, but it doesn't sound like there are many other takers.
I suspect those Farmers books will be the only books left in Whitcoulls soon - it is fast ceasing to be a book shop.
Tide does go in and out, you're right of course. Depending on time frame though, some companies look like the bath plug has been pulled out of their SP (oh, another metaphor!), hence my original metaphor of the tide keeps going out year after year. Though, if you prefer precise, it's gone out 10 of the past 15 years and is so far going out at the moment as well. I'm just eyeing up this company because it came up on my scan of stocks that still seem to be good businesses but their SP has been savaged and is around an all time low.
Attachment 6689
Attachment 6690
Not stupid BFG some just want to have fun aye , although long term holds are generally a better way to go trading can be an enjoyable challenge and can be treated like any sport and approached with much enthusiasm for certain personality types who arent content sitting on their hands:cool:
So you're saying that the water is a result of excited anticipation as opposed to just 'tearing up" from the horror of it all? Yes WHS has "enjoyed" a downward journey but along the way has provided some excellent entry points, has shown some strong growth periods and kept pumping out dividends. If you had bought at strategic times and kept your average buy price reasonable..your gross dividend yield will have been and still is in double figures. So now the SP is at a very low point and as you say its "caught your eye". There are some who see that as a disaster and others who view it as an opportunity. All up to the individual and as always only time will tell. Personally I have been holding since 2011 and bought periodically in 2011 and 2012 but nothing since then and have been waiting to begin accumulating again. The last week or so and also the coming weeks are in my opinion that time. Wish I could look ahead 3/4 years and check it out but that, as you would say, doesn't hold any water.
Well good luck with the knife-catching. As BB says, knife-catchers are needed. I needed one the other day selling WHS at 2.89.
I read about one sucessful one in Market Wizards. He had tiny trading costs, and the guy said it was really difficult and stressful. Lots of false entries.
So DO you actually make money from this type of trade?
And was it you or some other Canadian who got kiwis saying 'aye'?
I'm just having a bit of fun with WHS playing around with spare money right now so no, it's not a full time job, but yes, it is stressful (although the stress has decreased markedly over the years). I usually go for full disclosure on my trades as well so that others can learn on here as well. By no means do I get it right all the time (just look at AVB.ASX - ANGRY at management!!!).
I wish it was myself who could say they got all you Kiwis saying eh (note the spelling!), but alas, I am not that important or influential!
See where she goes today. I see $2.60 as support and $2.75-$2.80 as 50% retracement target. Anything above that is great imho. :)
Still haven't sold. Volume is good and buyers are supporting price well. At this rate I expect a full blue candle at days end (ie traded out to the days high) with follow on buying tomorrow. ECB anniuncing QE soon so I expect markets to stay positive near term. Lower oil and very low inflation also bolster WHS. Will reassess situation later. One day at a time :)
If you keep going that way, you might turn from trader to investor :p
Good work BFG, ride the wave. I've got a lot of ground to make up on WHS, fortunately SPK is easing my pain.
WHS has been having some crazy sales of late. I read an article recently that said retailers are cutting margins to the bone so while there are a huge amount of transactions, there's often not a lot of money being made. This ring has been on the WHS website since later November for $8000 and is now $2349. In one day it has come down $5650. At the other extreme, yesterday it was selling charcoal BBQs for...$7. I mean seriously - how are they making money on these things?
http://www.thewarehouse.co.nz/red/ca...ng?SKU=1784413
And they (Norman's) still at it-increased holding by a further 1%
http://www.nzherald.co.nz/business/n...ectid=11390204
I think they got ripped off :/.Quote:
Originally Posted by NZHerald
I do wonder if the NZHerald ever proof read their stories. I guess that's the downside of instantaneous 'news'.
Still holding...for now.
I was in for a good time, not a long time. Short term indicators topped out so I took my 9% profit. See chart as to why.
Attachment 6698
Good luck to all shareholders :)
I think there is an old schoolboy joke about bottom picking which I wont repeat.....but I/m sure that sweet smell of maple syrup and the gentle rustling of banknotes is dominating so lets all enjoy Moosies happiness (and the Normans). Don't you just LOVE?HATE?CANNOT UNDERSTAND? (choose the most appropriate please) sharemarket?
So I bought at 2.89, 2.76 and 2.62 and still have cash so hoping for a reverse Doberman dip to cancel out the feline flip.
I got a bit lucky with ACC & Pascoes buying in at the same time as well.
BFG can stand for anything you like it to. I usually use Big Friendly G(M)oose, but there are others you can use incorporating expletives :)
My head needs to be big for all the brains (and antlers) :D
So what do you peeps reckon the Normans are up to, what is their cunning plan?
Only reasons I can see are muscle.
Muscle with suppliers,and muscle with Landlords.
WHS pay a lot less rent than Farmers,who pay less rent than Whitcoulls,who pay a lot less rent than Pascoes.
Then can use the same warehouses and distribution systems,IT,payroll etc.
Hi Percy
That all sounds good but to enable that muscle to be flexed wouldn't they need to be in a position of real power? How could they execute unless they were in total control? What am I missing?
From small acorns large oak trees grow.!!!
Maybe the Normans see themselves as no threat to the supermarket shareholders?
What you (we) are missing is real hard facts from the horses mouth. So obviously they (the Normans) will be holding that info closely. They have reportedly said that they are treating the purchase of WHS shares as an investment. Ok but an investment for what purpose, and to what direction. If I was in their Gucci loafers I may be thinking...lets buy into WHS and use position as leverage to replace WHS existing jewellery stock/kiosks with existing Pascoes staff (better trained) and stock. Close down existing Pascoes stores...38 in number so save on high main street overheads etc, shift staff and stock to 92 WHS stores after negotiating much smaller overhead costs etc. Its a win win...WHS ups the quality and training of the jewellery component, gets additional new income from space they already pay for and no longer has to worry about buying and controlling something they don't really understand. The Normans can use WHS to fold in existing Whitcoulls stock (and staff), Farmers..the same. WHS also gets rid of competitors. Of course that's all cloud based speculation and I have NO facts to support that. However stranger things have happened and let get real ...The Normans are up to something...and they ain't dumb by all accounts. Whether real or speculative the interest can only drive the SP in one direction ultimately.
IMHO... retail isn't dead or dying and the internet isn't going to kill it off.
There'll always be a need for shops.
Retail's going through a period of adjustment.
We had too many shops.
Shops, whole chains are closing down. Food shops seem to be becoming more numerous.
When the dust settles, there'll be a smaller number of well-managed shops left - the ones that adapted to the web, are well managed, had a bit of luck, are in the right sectors.
I think WHS, BGR (provided Rod Duke lives forever) and HLG will survive, and flourish again.
Some calling for heads to roll
http://www.nzherald.co.nz/business/n...ectid=11391064
Shareholder activism in WHS hard to get going methinks. Too many shares closely held and rest spread amongst instos, nobody really to push the issue except the Normans
Need to get mr tindall to see things are not going right
http://www.nzherald.co.nz/business/n...ectid=11391064
"Rickey Ward, NZ equity manager at investment firm JBWere, said calls for board and chief executive changes were "a little bit harsh".
Ward said challenges such as online competition had caused disruption in the retail industry.
"I don't think you can put that down to the CEO or the board," he said. "I think they're doing what they need to do and that is diversify."
I side with Ward and I'd leave the CE where he is at this stage. Business on the online site has grown 30% and the stores have a good vibe. I'll see how things look in 12 months.
The board and CEO have been making all the right decisions.
For the business to survive they needed Noel Leeming's suppliers,they needed Torpedo online business,and they need a finance division.
Just a fact of life they needed to spend a lot of money staying where they are,and securing their future.
Failure to do so will have speed up WHS demise.
Salt and Milford show no long term interest in WHS's future.
People who do not understand the long term problems retailers face,should not offer short term advice.
Salt's managers and Gaynor probably know the WHS is well past the point of market saturation and the business as it stands is on a hiding to nothing. Come on... how many braches are there, far too many is the answer !!
Halve the number of branches, halve the staff, transform the remaining braches so that the shopping experience feels a lot less down-market, make sure all the major brands are represented in each store, slash corporate over-head e.t.c. Unless something truly transformational happens like I've outlined then its probably more of the same woeful under-performance. I'm with Salt and Gaynor, time for some truly revolutionary thinking.
Extremely tired brand that's desperately calling for a real transformation. Those professional investors know Tindall would never go for that so quite frankly they see better opportunities elsewhere and I can't say I blame them as they're quite obviously tasked with getting the best return for their clients money. Good on them for speaking out I say. My 2 cents.
Yes I agree.
Those are pretty much the reasons I would not invest in it.
However I would think Tindall and other long term stakeholders,staff and suppliers would disagree with us.
Future could be a small number of branches doubling as showrooms and processing centres for online shoppers.
I'm wondering if the Normans have thoughts of participating in a rationalisation involving their shops and the Warehouse's.
Suspect The Warehouse would be the surviving brand.
Roger, if you added up your "2 cents" on this "tired old brand", you'd easily be able to buy a quality gift from The Warehouse, something like this perhaps: http://www.thewarehouse.co.nz/red/ca...ch?SKU=1879876 It's the genuine article and at 50% off! Come on, you know you want it and it would help me and Birdman out.
You've written quite a few posts here complaining about the down-market feel of the Warehouse. It doesn't really do it for me either but the Warehouse is a down-market brand. It was born as a down-market brand, you're never going to transform it into Farmers or Smith and Caughey and it wouldn't be right to.
If you bring it up-market, then it stops being "where everyone gets a bargain".
I travelled around a few Warehouse stores during the week. They actually seemed nicer than I expected. Although, there does seem to be a lot of the stores devoted to DVDs and books, both of which are dying products.
Hey, I'm wearing my Warehouse bought $499 g-shock aviation watch as we speak :)
I should add for some balance that I find the Noel Leeming stores well laid out and a pleasant place to shop. Warehouse Stationery also seems well situated. What I'm suggesting is its time to move the Red Sheds closer to the mainstream because clearly what they're currently doing isn't working from an EPS perspective but here's a potentially scary thought for shareholders. Maybe Mr Tindall with all his altruistic and philanthropic tendencies doesn't really care about whether this works from a EPS growth perspective and just wants to be able to serve New Zealanders at the lower end of the socio economic ladder ? He views success by many other means than simple EPS. Employment opportunities for young Kiwi's being paid a "liveable" wage being one of his many other objectives. Maybe he should finally move to take it back to full private ownership..wasn't he rumoured to be looking at this some time back ?
I remember a long time ago my partner telling me how good the g-shock was and how much women liked their men to know how to use it properly. So I said "honey, I just don't have the time to do it myself, why don't you just get one working for yourself"? She left me soon afterwards.:p
Fantastic, I'll do what I can to learn the ins and outs of it.