Gear4music (holdings) Share Discussion Threads

[ragehammer] 14/9/2016 09:28

I'm pretty sure they must have been picked up by an institution(s), given the lack of price movement. Hopefully we'll see another RNS to confirm shortly.

[cbootle] 14/9/2016 09:19

Thanks rubberbullets (10cc reference?) - I'm new to this, investing part of my SIPP, so please forgive basic question. The director dump (value nearly 4m) hasn't appeared in trades yet at time of writing.

Does this mean we can now assume the market has digested this news? Will the massive trade appear at some point, possibly triggering reaction by those not watching the RNS?

[alphabeta4] 14/9/2016 07:56

Thanks Saucepan

Rubberbullets - when to sell always creates challenges - personally I feel you can't blame someone for topslicing a winning position like the rest of us. I'd much prefer that than someone dumping shares on a profit warning!!

Good to see how easily absorbed they were. Hopefully has piqued the interest of some new institutional holders.

[rubberbullets] 14/9/2016 07:26

Massive director dump
sold 1,760,000 ordinary shares

[saucepan] 13/9/2016 13:27

Good post, Alphabeta4

[alphabeta4] 13/9/2016 11:38

Just taken a small holding. For what it's worth my thinking is below...

The company has clearly had a strong first six months, growth was 66% for the first 4 months and 73% for the first six meaning growth was 80% for the last 2.

At 70% the company would hit Edison's 2018 forecast from page 4 of the note below with sales of just over £60m.



Their profit after tax for this outcome is just over £2m which would equate to a PE of 22 for the current year.

They have given an indication of their target revenue with the warehouse plans to help expand turnover to £100m. On the same margins I have profit after tax of £4.24m which would equate to a PE of around 11.

In terms of how realistic this is their website shows the top 10 European markets with revenue of £4265m:



They're in around 20 European countries but taking this as a cautious estimate it would equate to around a 2.5% European market share. I'm sure I've read circa one quarter of UK music sales are online, I suspect Europe is slightly behind (as I'm always reading about how high the UK's data consumption compares to Europe, especially mobile) but this aside it would work out around 10% of current online music share.

Doing searches on Google for items such as 'Yamaha guitar' they appear on the front page at around the second to fourth result after the paid for ads.

I know that UK online sales are growing at 20% a year, I'm not sure of a European figure.

So in terms of price forecasts it really depends on taking a view how quickly it will hit these various figures. The eventual £100m looks undemanding as it can do this through the growth of online shopping or accelerate this by continuing to take market share. Clearly a PE of 11 for this type of business will end up too low.

If it hits the £60m this year for the PE of 22 then IMHO there should be substantial upside as that will be way too low for an online growth stock that's just posted 70% sales growth in a year (as an example I invested in BOO at a PE of 22 and it's now on a forward of 45 on sales growth guidance of 28% to 33%).

I'm cautious to say it but even after the rise of the last week if current growth continues I can see 100-200% upside here.

[ragehammer] 13/9/2016 09:59

There were a total of 3.47m shares shifted at 210p yesterday in a series of trades over lunchtime. From what I can see only Andrew Wass (40%) and Key Capital Partners LLP (24%) have a shareholding that large.

[gnome3] 13/9/2016 02:06

Were more than 17% of the company's shares really traded yesterday?! I suppose that can only mean that one of the major share holders has off-loaded a chunk. It'll be interesting to see who's bought in.

[fruitninja84] 09/9/2016 20:57

For anyone interested go on google maps and type search gear4music then click street view. It should take you just outside there offices and distribution center. You can then go IN the shop with street view! I usually use google earth when researching as i like to see the bricks n mortar ...

[battlebus2] 09/9/2016 14:11

Well you know where to give the nod first :)) Sorry about the O/T guys..

[chrisis33] 09/9/2016 14:06

Yes, AIEA and STY come to mind, and CRAW of course... Equally had a few that have gone nowhere of course. With these investments now being in my SIPP rather than with a shorter term objective of in mind, I'll hopefully be more patient this time around when I spot what appear to be undervalued or high growth shares.

[battlebus2] 09/9/2016 13:53

Chrisis33 AIEA from memory was one of yours???

[cbootle] 09/9/2016 13:53

Same here - SIPPs are going raise the volumes in AIM generally, I think.

I've started a thread for quiet, long term shares with potential:




Another with similar "waiting to pop" feel about it is ARC. DYOR and you'll be impressed ;-)

G4M caught my attention as friends use them - and I was impressed. It's a gap in Amazon's service. Rather like Wiggle (now huge) who are the Amazon for sports equipment, primarily cycling (again, where Amazon let the ball slip, by focusing on the low-end).

[chrisis33] 09/9/2016 13:36

Hi Battlebus, Fruitninja - Was on my watchlist from £1.30... Been out of investing for a while but I've now arranged my pension into a SIPP and drawing up an investment shortlists. A few of my contenders (like G4M) have already popped though :(

Will keep watching :)

[fruitninja84] 09/9/2016 12:47

Me too @battlebus but I finally took the plunge at 194p a day after trading statement as it was up 2.7% within the first half hour of trading! I suspected it would of ended up higher on the day so I took a chance . Hopefully I can get some more if we get a dip or shake .. If they deliver on achieving 100M rev next trading year I can see this being at least a 60m market cap company . Maybe sooner rather then later . The city seems to love these online retailers with high turnover numbers . Just look at Ao world. What really interests me here is they have there own brand which imo could increase margins should they increase sales . All imo. Still researching ..

[battlebus2] 09/9/2016 12:38

Watched it at £1 1.50 180 2.00 220.....what a dummy :))

[fruitninja84] 09/9/2016 12:30

Anyone else watching and waiting for a dip to top up or add?

[lufc5] 08/9/2016 20:21

Those late reported trades are from 6th Sept' and all or most appear to be buys(all showing as sells) a total of around £400k worth. That could be an institution/s? There isn't much stock in free float, and now appears to be even less, hence the rapid rise. It's hit my targets like a 400m runner doing it in a 100m time....
Very impressed indeed.

[thevaluehunter] 08/9/2016 15:15

From a quick look at the trading statements I think G4M is on for £60m t/o this year and say EBITDA at 5% (£3m) give a very low EV multiple for a growth company. I think there is big upside from here!

[lufc5] 06/9/2016 21:44

Just as long as iloveit stays well clear(lol), I'm sure this one will turn out very well indeed. From the trading statement, the % increase in sales was nothing short of superb. At this rate they will have to work even quicker at looking for a larger UK dist' hub. I can't see them having 2 hubs(overhead costs), so a far larger one, maybe still in Yorkshire. I know the building they are currently in, as I used to work in it when it was a printing factory during the 90's. I would think they will be looking for somewhere closer to the A1/M62 area purely on logistical logic. Was a little surprised at the Swedish opening, but opening a 2nd Euro dist' hub didn't. Where that will be? Fra, Ger, Swi? Lux may have tax benefits, I don't know....?
Cheers Saucepan. Glad you noticed this little future gem.

[saucepan] 06/9/2016 20:56

Cheers, LUFC5. Yes. Let's hope this is a better proposition than COO :-)

PS: I am surprised how quiet it is here. G4M still somewhat off the radar?

[lufc5] 06/9/2016 19:59

Hello there Saucepan. I'm sure I remember you from the coolabi days?
Welcome aboard.

[saucepan] 06/9/2016 08:27

Opened a position today on the strength of today's "ahead" update.

[lufc55] 06/8/2016 02:25

When next results out, you won't be buying them this cheap. Buy, hold and enjoy the music, as it sings it's way to £2.00 plus. My prediction for 2017 is over £2.20. We will see.....