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Real-Time news about Woolworths (London Stock Exchange): 0 recent articles
|fazersix: Wish someone could answer that question suppose we have to think of the closing price of wlw share on removal from the footsie @ 1.2p and delisted at 0p for a possible relisting price of 0p.
A rumour woolies brands for sale by Deloittes around 8 million squid.
It look to me as there's insufficient funds to pay all deptors and there must be thousands of us investors with empty pocket IMO.
I had an email from Deloittes stating there would be no monies for shareholders
this time quote !
Bigface - think that 16p thingy was based on a much higher wlw share price.|
|hamsterape: are the board of directors working with or for the administrators
at present and dont they have a legal obligation to share holders or
am i being to simplistic
The directors are appointed, with the approval of the shareholders,
to run the company with the intention of making a profit and increasing
You as a shareholder are entitled to a share of those profits and a share
of the assets of the company (should it ever be wound up) over and above
the amount required to pay off higher priority creditors.
Tha banks and tax man get paid first, then the bondholders then the
preference shareholders then the ordinary shareholders, if there is any
The original share investors risk lending the money at zero interest
and possible loss of capital in the hope of receiving a growing stream
of dividends and capital growth. It's not much different to owning an
option on the share price itself which can have an exercise price above
the current share-price thus consisting of time value (= hope value) only
or, instead, the option could already have some value if the share price
has risen above the exercise price.
In our case the book-value equivalent of our mythical option's "exercise
price" is the total value of the debts and the equivalent of the "underlying
share price" is actually the total asset value.
The amount of money that can be attributable to the shareholders is the
total asset value minus the total debts (including administrator fees).
It's that simple.
Here's a mythical example:-
Number of shares in issue = ten million
Value of assets (e.g. remaining parts of leases)£100m, realisable value
of unsold stock £10m, cash £2m:
Value of debt to tax man £5m, debts to bank £50m, other suppliers £40m,
under-funded pension liability £6m, bondholders £5m, preference
Total = +£110m
Difference(attributable to shareholders) = £2m
With ten million shares in issue the shares in this mythical example
would be worth 20p
As Woolworths Group itself is not in administration the share price
(after unsuspending) will reflect any residual asset value from the parts
in administration (if any) plus the value of the other businesses, plus
the "time value" attributed to the possibility of the entire group being
profitable in the future.
Presumably, if the assets minus the debt is a negative amount the other
parts of the business may have to be sold and shares in Woolworths PLC as
a group may well prove to be worthless.
At the time of suspension the market placed a value of about 1p on the
small chance of Woolworths recovering from it's present dilemma and becoming
profitable again in the future - presumably all or most of this would be
hope value (i.e. time value) so the market was assuming that the sale of
the assets would most likely not be sufficient to cover the debt and still
leave any excess for the shareholders.
There is also the intangible value of Woolworths as a brand name which could
add some value to the assets if the parts of the business could be sold on
as going concerns. There is also the possibility that the underfunding of
the pension scheme could dissapear if the market rises - this can only happen
if the company continues as a going concern.
In fact it's entirely possible that Woolworth's could become a high street
shop no longer owned by Woolworth Group and the holding company would change
it's name to something else.
Marconi sold off most of the Marconi technology and the remains were
I believe Scottish & Newcastle breweries sold their breweries in both
Scotland AND Newcastle and became colloquially (though not officially)
known as "Ampersand Breweries". Not strictly relevany I guess, but it
made me chuckle.
Anyway, the best hope for shareholders is surely if Woolworths stores
continue to trade under that brand name. Theo Paphites complained that
Deloitte wouldn't do him a deal on them because he claimed they thought
the sum of the parts was worth more than the whole - well I suspect
"the whole" may be worth a lot more than the sum of the parts but people
aren't willing or able to pay a premium to own all the bits they don't
want and be lumbered with disposing of them later. Hence I'm not convinced
Theo's bid would have been the best deal from a shareholders's perspective.
If it was of value to shareholders couldn't he simply bid for the shares
directly by approaching those on the shareholder register and take on the
liabilities to the debt holders?
The spanner in the works is GMAC wanting their capital back. Typical of a
bank, really - they lend you an umbrella while the weather's fine and then
ask for it back as soon as it starts raining.|
|pjdeery: To add some more joy to the posters that are having such fun seeing the WLW share price crash. I hold 1.2 million all paid for. Should they go bust i lose £172,000 real cash.Like i said i am a gambler.That is a real gamble and if any off the laughing crew on here want to gloat feel free.|
Naghshineh's statement that the WLW share price is worth at least 24p etc and the stores's leases up to 5 million is certainly an eyeopener. Or is it someone who has paid more than 2xs the current price and is interested in getting his money back. With 5 million shares traded on Friday not much movement. Any thoughts on this latest development. Hope you had a good shopping trip? WLW stores seem like a magnet to shoppers looking for bargains and thanks to the new CEO and his directors.|
|gumbsy: Can someone clarify something for me please;
With over 3million buys and only 112k sells today, why has share price not gone up more significantly. I may being naive but thought share price was linked into supply & demand.
Who decides and how does the share price go up, clearly today demand has outstriped supply.|
|davy99: Mail on Sunday
Sir Alan Sugar trawls High St for value
12 October 2008
Cash is king and rich investors with a fistful of readies could be heading for massive profits in the next few years if their timing is right.
After record falls in share prices in recent weeks there are signs wealthy investors are dipping a toe in the water in the hope of spectacular returns in the long term.
Last week, Sir Alan Sugar, entrepreneur and star of TV's The Apprentice, spent £1.8m on a 3.9% stake in beleaguered retailer Woolworths. The outlay will hardly dent Sugar's estimated fortune of £830m, but it was brave given Woolworths' share price was trading at a record low of 2.63p last week, putting its stock market value at six times less than its debt mountain.
Another investor gambling more of his fortune last week that a share price was near the bottom wasbnaire Joe Lewis, who paid £137m for a 25% stake in pubs group Mitchells & Butlers.
Buying shares when everyone else is selling is known as contrarian investing, or more commonly 'bottom fishing' since it involves trawling among sunken share prices in search of a prize catch.
Crashing markets can lead to huge losses for investors, but history shows that those who brave choppy waters and invest for the longer term can make spectacular returns.
One of the most famous examples of this approach is when American value investor Warren Buffett bought $1bn worth of Coca-Cola shares a year after the 1987 stock market crash.
Buffett, whose favourite drink is Cherry Coke, paid $5.46 a share for a seven% holding. Ten years later the shares were trading at $88.
Sounds like you made the right decision. I too have been an investor for many years and rarely see such a clear and excellent investment such as this one. I have followed but not bought WLW ,for a couple of years. So I know the story well. Didn't have the funds available when it dipped to 5.5p but got in substantially around 7p.
My reasons for investment were NAG stake building, assets not listed on the books(leases), Director buys and so many shorted shares needing to close.
I used to have a chain of shops and know the cost of leases well. SOme are liabilities but some are the crown jewels. When WLW pulled £25.5m out of the hat selling just 4 leases I found it amazing that these had not been listed as assets. Clearly there is hidden value here.
The great locations WLW have also means many more stores would be snapped up by retailers desperate to move into new towns etc. A property developer such as NAG may be best placed to gain maximum advantage.
Director buys are often a good guide though not always. However the share price has risen ever since and that too is a good solid indicator for me.
As for the shorters I never do understand why many try to push for 1p etc rather than accept a slightly higher price to buy back and ensure guaranteed profits. The rising share price since the Director buys means that pressure on shorters is increasing by the day. They simply have to close out and 100m shares being bought is going to drive this back to 20p especially if a bidder makes a move.
THe appearance of unreasoned shorters on BB's is often a pointer when a share price is rising.
Then there is the graph. One of the very best graphs I have seen for a long time. No steep climb good steady progress upwards.
It really does not get better than this IMHO. While I have no idea where the share price will finish I am certain that it will double in the short term and possibly triple.|
|davy99: The Telegraph
Should you pick 'n' mix your shares as the big names flounder?
By Kara Gammell
Last Updated: 2:52pm BST 27/08/2008
Shares in Woolworths jumped by 15pc last Monday after The Sunday Telegraph's scoop revealed a takeover approach for the beleaguered retailer.
Low share prices for many household names in today's depressed stock market conditions can represent a buying opportunity for investors willing to take a medium- to long-term view.
One way of reducing your investment risk during volatile periods is to invest in a pooled fund with an experienced fund manager.
Some funds are better placed to benefit from isolated outbreaks of intent and some fund managers are better able to spot potential than others - and reap the rewards.
Gavin Haynes, the investment director at Whitechurch Securities, said: "Fund managers best-placed to benefit from potential takeovers tend to be those following a contrarian approach, which in simple terms means taking a view that is opposite to the vast majority of investors. This will result in buying investment areas that are out of favour."
But it is difficult to spot the fund managers that can do this on a consistent basis.
Nicholas Round, managing director of Murray Round Wealth Management, said: "If Woolworths falls into the fund managers' universe of stocks, they all want to spot the opportunity to have bought low in the hope of selling high. If they all spotted an opportunity, the price would probably have risen, taking away any gain from a potential bidder."
He added: "If an investor had a well-constructed, diversified portfolio, they would probably have Woolworths as part of the portfolio and so would benefit from any price uplift."
Hugh Yarrow, co-manager of the Rathbone Income Fund, said: "This is a difficult environment for most retailers. Despite our marginal overweight, we remain cautious on the sector due to the high levels of operational and financial gearing involved, and further downward pressure on the consumer. Yes, valuations are low, and we believe there is significant upside on a long-term view to justify investment in lower risk names. There might be more upside in riskier names, but there is also greater potential for serious downside and permanent capital loss. The key to investment in this area is, therefore, to be selective."
So, should investors jump on the bandwagon and snap up shares before a takeover?
Mr Haynes said it is not as simple as buying into an investment just because it is being avoided by the market - there may be a good reason for this.
He said: "A good contrarian investor needs to ascertain why the market is overlooking the out-of-favour areas and why they are mispriced. Also, what may be the catalyst to turn around these areas and see re-rating. This catalyst may often be a takeover approach from companies looking to exploit cheap share prices.
"The contrarian approach is particularly effective during market slumps when shrewd fund managers are prepared to buy for the long-term when investors are unduly pessimistic. This can result in excellent out-performance over the long-term."
Mr Haynes said investors are likely to see more takeover activity among medium and smaller companies rather than mega caps, so funds that look for opportunities in these areas are better placed to benefit.
Mr Round said investors should remember also that Woolworths is just one company and the market is constantly changing.
He said: "If a fund manager happens to make the right call at the right time, that is excellent for investors. Yet, the investor has no real idea who that fund manager will be or when it will happen. For this reason, it is more important to be focused not on the potential winners, but on ensuring that investors do not make bad decisions that cost them money. The market over time is a winner, why take a risk when a well diversified portfolio over time gives you the opportunity to win by default? Sticking to passively-based investments is the key."
Should investors bag Woolworths while they can?
Darius McDermott, managing director of Chelsea Financial Services, said: "Woolworths rebuffed this offer on the grounds they believed their assets are being undervalued; however, I am a little surprised that the current management decided to reject the offer outright without even arranging talks to explore a potential deal.
"Woolworths as a business continues to flounder, debts continue to grow and the pension fund deficit has moved into a worrying condition - what can shareholders hope to expect? "The situation is quite precarious for Woolworths management unless the business can be refinanced and overhauled. If the position was to worsen this would leave the group wide open to more opportunistic bids in the future.
"The share price is being pushed upward by the speculation but Woolworths as a business has a lot of obstacles to overcome if it is to grow."
He added: "Aside from the few retailers that will buck the trend, we see continuing difficulties in the retail sector as credit dries up, and Woolworths is not a company we would hope to find within a UK portfolio." Mr Haynes said that although a new management team has been brought in to turn around the retail business and rebuild the company, Woolworths is facing some difficult headwinds. He said: "The fallout from the credit crisis will continue to see retailers under severe pressure and the group recently warned that it expects profit forecasts to fall amid this tough environment for the consumer. However, as the share price has fallen around 70pc over the past year, this may be a stock that fund managers, looking at recovery plays, may be beginning to see value emerging from and this is reinforced by the takeover approach."
|bingobarnes: Logan we'll have to agree to disagree...you state that:
"There is a huge demand for Rank shares with a dwindling Supply, but the share price still goes down."
..well clearly there may be a demand but the amount of sellers is higher than the amount of buyers. That's the only reason why the stock is going down.
I've not seen it on this thread, but on many FTSE100 threads i am amazed by how many people believe a share price is being manipulated down by brokers/ market markers....as everyone here knows i'm sure SETS is an order book driven system...there is (to a large degree) no manipulation. The vast majority of PI's would rather believe that their stock is being maniupalted, shorted...anything but admit that the price isn't where it should be.
If a stock, be it WLW or Rank is below where you think its "fair value" buy-it!
As for Rank - its share price has been pummelled for a variety of reasons and is lower than it was at the start of the year for those reasons. Just because someone builds up a stake at rock bottom prices doesn't make them the cause. The smoking ban and removal of FOTB's (so called "Mega-jackpot fruit machines) where the nail in Rank's coffin - though i actually believe a couple of recent events may signal the turnaround in their fortune. Could be a long term recovery story. IMHO|
|bingobarnes: Logan - to be fair you still haven't answered my question on how you think the stake building has stymied the share price rather than actually caused it to rise.
Whilst I agree that clearly the more money a consumer has the more they spend in the shops (though one might argue that in a down-turn WLW should benefit from a switching by consumers from the likes of House of Fraser to WLW - slight tongue in cheek) does enrich earnings, at the end of the day i reiterate that is it simply supply and demand which moves a share price.
The building of a stake - and with more demand than supply - has driven the share price up. I'm sorry on this single point you cannot surely be in dispute?|
Woolworths share price data is direct from the London Stock Exchange