Debenhams Share Discussion Threads

[ny boy] 08/9/2017 11:09

Bears will check out soon, undervalued here dyor and ignore the noisy bears and gloom muggers.

[ny boy] 07/9/2017 15:38

Bottom in here I reckon, added some more at 41p divi to come in dec again..hopefully but will be nice to see some share price upside too!

Uncle Mike will take these out next year, it's a hold in my books dyor as usual

[qantas] 07/9/2017 12:57

www.shorttracker.co.uk/company/GB00B126KH97/

13% Getting burnt today up 42.25p

Please do your own research...

[niggle] 07/9/2017 12:32

Dumping dinosaurs

[mister md] 07/9/2017 12:22

Board and Senior Management changes ...

[chinese investor] 05/9/2017 14:18

Here We Go !

[justiceforthemany] 05/9/2017 13:53

RETAIL SALES CLIMB IN AUGUST CONFOUNDING EXPECTATIONS

[simon templar qc] 05/9/2017 10:56

John Lewis Partnership weekly sales out:



Waitrose up 3.4% but 5 weeks on second half poor at + 1%

John Lewis - 0.5% on week, + 4.4% on 5 weeks.

Waitrose still struggling taking into account food inflation. John Lewis need to be making at least 5% taking into account inflation and also increased shelf space.


edit:

BRC saw a uptick in retail sales in August of 1.3% but that was against a poor August last year. Outlook gloomy for analysts as service figures came out weaker than expected. Europe monthly figures show a -0.3% decline.

[simon templar qc] 04/9/2017 13:04

John Lewis interim results out late next week, they will give a clue as to the present retail environment.

[ltcm1] 04/9/2017 12:25

I think all your posts sum up the position perfectly. Kazoom argues the bull case very well, this could be the time to buy. If you think they have enough funding for the next couple of years I can see the risk/reward ratio looks good.

Is the pension situation definitely OK here???

The other thing is the Mike Ashley factor. I don't think his involvement is a positive development since he runs his own business so chaotically. There will be a big culture clash if he wants more influence.

[simon templar qc] 03/9/2017 20:03

Seeking Alpha say Debenhams "The Ideal Brexit Short"..

[simon templar qc] 03/9/2017 11:25

More news about Ashley as he takes a stake in Flannels to 75%..

[simon templar qc] 02/9/2017 13:31

An example of what the market thinks of Debs is to look at the valuation of online retailers. Its just been announced the founders of MatchesFashion have sold a stake in their business for a reputed £800 million!



MatchesFashion had sales last year of circa £200,000,000 and net profits of circa 10 million.

Sales increased last year at 60% !

With more and more online retailers in the market margins can only get tighter in bricks and mortar stores.

[simon templar qc] 02/9/2017 09:14

kazoom, very good unbiased post, I agree with most of what you say, unless of course sales were to take a significant downturn and that would create a massive problem.

[ignoble] 02/9/2017 08:14

Not just Debs but stores don't seem to stock anything that I would like to buy
We don't need a 6 piece dinner service , frying pans , saucepans and all that stuff.
White goods .... have them
Clothing , have all I need

Will buy the occasional shirt or trousers but little else.

Us Baby Boomers are stocked for life !
Lol

[kazoom] 01/9/2017 23:57

Thanks ltcm1, kind of you.

Yes it had crossed my mind that your points 2 & 3 appear contradictory, but I agree that to some extent this is a case of increased wages being offset by reductions in taxpayer subsidy. I don't have any hard data to back this up (I'm sure it's out there if I looked) but I also think 'differentials' at the bottom end of the pay-scales have tightened.

Point 1 is a key one, but if you look margins have been on a downward trajectory for ages (at the gross, operating and bottom line levels.) Why? Well in part because these scary, new fangled, internet operators have been with us for nigh on two decades!

There was a bit of marginally good news from DEB on this subject in the interims in that they have been selling more items at full price and on a product "like for like" basis their gross margins were up - unfortunately though consumers were actually buying proportionally more of the lower margin products, so overall gross margins were down!

It's clearly a bit of a mixed picture, but actually I think there might be a moderately good-news story on margins short term. Medium to Longer Term if this "experiential shopping" thing has legs (and I think there is a reasonable chance) then it should be good for overall margins.

Which leads on to your point 4 on investment. The strategy review is a bit of a double edged sword in my opinion. Over the next three years they will be spending well over Free Cash Flow on Capex and exceptionals for the transformation and this on the back of cashflow being pretty poor at the interims. Thankfully they have their funding fully backed off for three year period of the transformation, barring any black swans in the short term. But this does mean that the transformation needs to show clear and fairly early signs of results in order for them to get reasonable renewals on financing in 19/20, otherwise they could be in serious trouble imho.

On balance though to me, this seems a pretty good story in terms of risk vs. reward.

I might well be a buyer at these levels, were it not for the fact that I firmly expect retail trading conditions to remain poor for at least 6-12 months and probably result in better buying opportunities yet.

IMHO, there's no obvious catalyst for a higher share price any time soon, but there are some potentials for a lower one. Patience is one of the things I think I'm learning with age 8-) a decade ago I might have thought of this as a classic and urgent value situation, but now I think there is plenty of time to wait and experience the green shoots of recovery and to satisfy oneself that it was indeed fertilizer in the watering can and not weed-killer.)

As ever, just one poor schmucks view - DYOR etc. etc.

[ltcm1] 01/9/2017 17:18

Superb post Kazoom.

I don't think the internet is Debenhams problem, infact they have a decent offering themselves. The problem as I see it is

1) a possible margin squeeze

2) The lack of wage growth in the economy as a whole

3) The upcoming living wage increases

4) A lack of investment since 2006 for the reasons you cited.


I know 2 and 3 look like a contradiction but the effect of the Osborne living wage changes is to pass more of the burden to employers while the state reduces benefits.

The trouble is Next and M&S are suffering too so it could lead to a classic squeeze situation.

[simon templar qc] 01/9/2017 12:59

Debs looking for new agency, Portas on the shortlist...

[ny boy] 01/9/2017 12:40

I'm accumulating like the look of these, following Ashley, I'll probably end up out drinking him and throwing up in a pub fireplace close to Debenhams Oxford Street!

[simon templar qc] 31/8/2017 17:32

Don't BG only deal with plumbing? What JL appear to be doing is most tasks around the home, so they could in theory do a refer involving most trades.

They aren't the only companies doing this however Which magazine recommend tradesmen but JL is prepared to give a 12 months guarantee.

Its an interesting concept they will get takers JL's customers tend to be middle to high class and therefore prepared to pay for a decent job.

I could go further but haven't the time at the moment, I am fairly well clued up on what they are set to do.

It is limited as kitchen and bathroom fitters have a service all in but its those small one off jobs where there is a demand and avoiding being ripped off through rogue traders.

edit:

One can insure for water leaks with the water companies and these days if one has a crisis most insurers these days has its own internal facilities to deal with damage.

As for gardening well I am not so sure that will work to well, the price they appear to be charging seems high to me.

[qantas] 31/8/2017 16:35

British Gas already do that service don't think they will get demand.

[simon templar qc] 31/8/2017 15:54

Shows how tough the retail sector is John Lewis moving into builders arena...



Its a step forward from selling carpets and having them fitted, I don't think for a moment they will be stocking a lot of builders materials the store hasn't the capacity. As for recommending tradesmen, that wont solve the problem of excess store capacity.

At least they are showing some imitative rather than just introducing Costa Coffee just about everyone is going down that route.

edit:

One of the flaws in the business model is most good tradesmen get booked up in any event due to a lack of trades people in general. Its OK in theory but not as easy in practice.

[qantas] 31/8/2017 13:00

Wishing you both a nice day.

I just let your the rubbish go in one ear and out the other.

[montyhedge] 31/8/2017 12:05

Qantas
You can go talk to a shopkeeper, then come home and order online, lol.

Amazon have killed the high street, also business rates, rent.