Currys Share Discussion Threads

[billy two cocks] 23/1/2020 15:48

Agree stdyeddy.

Gone short, 20% of intended so far, looking to build position. Apart from Goldmans blowing sunshine all over this, I cannot see any reason to be long and many reasons to be short here.

There is a part of me which wants this to go higher in the near future to build a decent sized position and this may happen because this is acting irrationally at the moment.

All in my humble opinion, please do your own research, no advice intended.

Thanks

BTC

[stdyeddy] 23/1/2020 15:05

So the big number went from +2% to -2%, but all the other numbers are exactly right then? I wonder.

Baldock's claim that DC can match anyone on price suggests hubris and the hope that competitors will just give up. I suspect neither will happen. DC's bricks&people infrastructure will continue to be a huge cost and eventually they'll need the margin that they're currently sacrificing to achieve volume, to actually make a profit. Something has to give.

[smnicolson] 21/1/2020 20:46

Being cynical, I bet someone made some cash out of that "Misprint'

[boix] 21/1/2020 16:59

The Yanks were very short.

[stdyeddy] 21/1/2020 16:20

Indeed they do anonymous. In fact, it turns out they like the change which amounts to minus 4% from this morning, since it was misstated as +2 instead of minus 2. Makes you wonder what's driving it, doesn't it, especially on a down day for the index?

[kickingking] 21/1/2020 15:24

This will probably crash tomorrow when everything has been digested.

[anony mous] 21/1/2020 15:20

Markets seem to like the minus 2Lol

[double dd] 21/1/2020 14:32

I have never ever seen that before ever,

[stdyeddy] 21/1/2020 14:07

I agree double d. Selectively citing sales success of products from a stockholding of thousands of lines is not an honest account of sales. It is spin, not substance. Also, they've just issued a new notice a few minutes ago, revising the group revenue total from +2% to -2%. A major amendment and the market has taken a large gulp. The key issue is margin, and I strongly suspect that that has been sacrificed in a big way in order to keep the plates spinning in the air.

This update buys a little time. If nothing goes wrong between now and the June results, maybe the share price will stay up. But I think cashflow will become a problem towards the end of this month or February.

[double dd] 21/1/2020 13:16

Too much spin on the results this will drop back till we hear about shops/turnaround for mobile. Doesnt tell me that much these figures more questions than answers. Loads of positives but still on par for what we said, so why with all the positives are we not changing guidance, complete spin for me

[tim 3] 21/1/2020 12:48

Lots of resistance around £1.50-60 would feel a lot more positive longer term if it broke through that area otherwise might just be range bound for a while news will probably be light till results in June.

[anony mous] 21/1/2020 10:53

Well, shorters were still shorting at about 1.20 area. They will need to close i guess.Will this rerate towards 1.75 then 2.00.Chart looks as though uptrend now intact.Interesting....

[stdyeddy] 21/1/2020 09:20

It looks like they've sacrificed margin to preserve turnover (a line from the statement):
'Margin investment in improved customer proposition and unambiguous price promise'

For now, the ice has not cracked.

[tim 3] 21/1/2020 08:51

Yes not too bad if you took mobile out (down 9% L4L) they would probably be much higher.He says still on track to fix that so lets see.

[anony mous] 21/1/2020 08:38

Numbers look decent.
Nothing drastic.

Funny how BBC carries a negative headline. They (BBC) have not mentioned any numbers which are positive.

[tim 3] 20/1/2020 23:48

Should be an interesting day quite a negative piece in the Times over the weekend but bullish notes from brokers.

[tim 3] 18/1/2020 23:55

Unlikely to have been a disaster or they would have warned, I think it will be an average set of results with margins under pressure.

[bluecash] 18/1/2020 17:54

What do people here think about DC's chances of bucking the recent overall retail trend down?

[tim 3] 14/1/2020 20:59

Yes not really convinced by their arguments either.

"We assume DC will close the large majority of its standalone Carphone stores in the UK, and benefit from c.£100 mn of cost savings over the next two years"

They have some work to do there then considering they still have over 600 and Baldock said as recently as December they had no immediate plans to close any!Frankly would be amazed if they close the vast majority in 2 years.

The comments about the euro's and olympics are all well and good and there may be an uptick but there are no major new innovations in TV most people already have HD and availability of ultra hd broadcasts does not seem to be increasing much.5G also is likely to be a very slow process as comparable handsets are only just coming through and I dont sense much excitement about its roll out from the public.

All in all I think its a poorly researched note probably written by someone fairly junior.

Am not particularly bearish on them at this price but don't see many reasons to jump in yet either let see what the 21 brings.

[tim 3] 14/1/2020 13:32

Dixons: Goldman Sachs upgrades to buy with a target price of 170p.We upgrade Dixons Carphone (DC) to Buy from Neutral and raise our DCF derived price target to 170p from 130p:

(1) we expect 2H20 (April-2020 year end) to see an inflection in DC’s UK electrical segment profitability, and expect the segment to deliver consistent mid-single-digit earnings growth in FY21/22, driven by internal initiatives; (2) FY21E should see significant transformation of DC’s UK mobile segment, enabling it to move from a loss of £90 mn in FY20E to a £5 mn profit by FY23E. We assume DC will close the large majority of its standalone Carphone stores in the UK, and benefit from c.£100 mn of cost savings over the next two years; and (3) reduction in trade receivables (up to £500 mn) should fund increased capital expenditure and help reduce financial leverage (from 0.6x net debt/EBITDA in FY20E to net cash of c.£80mn in FY23E). We expect DC to deliver an EPS CAGR (FY20-22E) of 22% as a result of the above.

We currently forecast only +1% LFL growth for DC in FY21E in its UK electrical segment, and a steep decline in the mobile segment. However, we believe tailwinds from events such as Euro 2020 and the Olympics, increasing adoption of 5G phones, and improving consumer confidence over big-ticket purchases pose upside risks. DC will report its 3Q FY20 trading on January 21: we expect UK electrical LFL of -1% (on a comp of +2%). However, our more positive view and rating upgrade are a function of improved prospects for medium-term earnings/cash growth.