Ashley (laura) Share Discussion Threads

[barnesian] 23/6/2015 12:12

Irnbru2,

I see the risks as:

a) the longer term intentions of the Chairman, 76 year old Khoo Kay Peng, who owns nearly half the company through MUI and Bonham Industries. He is worth about £440m so his stake in Laura Ashley is about 25% of his total wealth. He is going through a messy divorce with his wife who is claiming half his wealth. Will this impact Laura Ashley? I don't think so but there is a small risk.

b) Laura Ashley is in the fashion business but fashions change. They have an excellent design team that keep up to date with design and colour palette. Sales revenue was up 3% last year in a competitive market so they are up-to-date. But there is a small risk around their design team longer term.

c) Global Markets are risky. Bond prices may collapse and impact all equities including Laura Ashley. It is hard to diversify that risk. It is part of the overall equity risk premium.

So overall I think the risk for AYL is small (but you still need a stoploss). The yield is outstanding.

I bought into BKG last November for very similar reasons when its yield was an incredible 7%. Since then the share price has risen by 45% and the yield is a more reasonable 4.6%. That is still good for a very low risk company and I continue to hold the stock. This is the basis of my investing strategy.

[irnbru2] 23/6/2015 10:44

I know. That's why the yield is at 6.6% to represent the risk. But I judge the risk to be considerably smaller than the risk premium

-----

Barne,

What do you see as the risk.

I don't see any.

[barnesian] 23/6/2015 10:35

I know. That's why the yield is at 6.6% to represent the risk. But I judge the risk to be considerably smaller than the risk premium.

The dividend has been maintained at 2p for the last four years. The company is financially sound and trading well so there is no need to reduce the dividend (unless the owner decides to - but why would he?)

I also note that the price trend for the last six years has been upwards.

If you join the tops and extrapolate to today, the top line is 35.5p. If it breaks that, I'll buy some more. It means the share has been discovered by a larger community of investors. I think that is quite likely.

If you join the bottoms, the bottom line today is 28.5p. If it breaks that I'll sell. Somebody knows something.

I suspect it will move between 28.5p and 35.5p, gradually increasing and in the mean time yielding 6.6%.

[bobby.ifa] 23/6/2015 10:20

Divi's aren't always guaranteed Barny!

[barnesian] 23/6/2015 10:13

There it is! Thank you. Spot on. Mine was the largest trade yesterday though two more buyers have followed me. I was quoted an ask price of 33p and was pleased to get 31.7p.

I am tucking this away for secure dividend income for two or three years. If other investors who are looking for income spot this, the price might rise too.

I guess the long term prospects depend not only on the markets it serves and the quality of the management (which both look good to me) but also on the intentions of the rich owner who has a 49% stake. I suspect it is a source of pride and prestige to him as well as a dividend stream of about £7m a year (which is probably peanuts to him!)

I'll probably hold for the medium term.

[speedsgh] 23/6/2015 09:44

Barnesian - your trade can be seen here -

[barnesian] 23/6/2015 07:43

Thanks gdjs. That's informative. I didn't know that.

[gdjs100] 23/6/2015 07:32

FYI - your 80k traded on ISDX, not on the LSE, hence why you don't see it on the LSE tape (it's on the ISDX one). 329k shares traded on ISDX yesterday vs 181k on the LSE.

[barnesian] 22/6/2015 23:15

I've just bought 80,000 today. I'll tell you why.

The yield is a solid 6.6% backed by a very consistent revenue and profit record over the years. It has cash and no debt. It is in a profitable niche in a bouyant high-end housing market with its home assessories and decorating materials. It has John Lewis type customers and website, and growing on-line sales.

So I'm in along with investorneil1. I bought earlier today before I read his post (which I agree with).

I picked ALY from my Stockopedia screen with high stockrank(98/100), high dividend yield (6.6%) and market cap above £200m.

You can't invest in John Lewis but you can invest in Laura Ashley.

PS I bought at 16.19 at 31.7p through H-L but it hasn't shown up in the trades yet.

[thorpematt] 22/6/2015 23:10

Deja Vu.


All over again !!!

[eeza] 22/6/2015 20:24

Deja Vu.


All over again !!!

[badtime] 22/6/2015 19:25

Erm..are you predicting whats already happened.....again

[irnbru2] 22/6/2015 18:54

It is going to above 30.

[irnbru2] 22/6/2015 18:53

Who are talking about.

[eeza] 22/6/2015 18:44

Don't be silly - FFS.

He only buys winners.

& tells you afterwards.

[investorneil1] 22/6/2015 18:28

I'm in. Cash on the balance sheet, big dividend and excellent last update. Also, their products are in the right place at the right time so I see ALY doing very well over the next few years. Look like a classic Naked Trader stock imo too. Wouldn't be surprised to see him become a buyer!

[badtime] 22/6/2015 13:05

Oh dear share price seems to be going up

[irnbru2] 16/6/2015 16:48

Yep, might have a few more at 28p.

Starting to look like someone is having a laugh, buy 28p, sell 34p/ish.

[srpactive] 15/6/2015 22:59

It is above 30p.

[killieboy] 15/6/2015 19:19

Looking to buy under 28p - wont be long!

[irnbru2] 15/6/2015 18:25

It just can not stay over 30p.

Sub 30 tomorrow.

[irnbru2] 12/6/2015 22:43

Good answer.

It is also looked at as quality share, so the yield comes down a bit.

Totally safe.

[srpactive] 12/6/2015 21:35

Yes, never goes up in a straight line.

[killieboy] 12/6/2015 18:59

Falling through the floor. spractive - still looking for 40.25p - we may have to wait a few years yet!

[badtime] 05/6/2015 15:17

Drifting with the general market despite div due next week