Gear4music (holdings) Share Discussion Threads

[runthejoules] 10/5/2017 13:11

Blimey Shanklin. Is that because of prospects for a consumer goods recession or other reasons?

[bestace] 10/5/2017 12:43

This comment was interesting though:

"The company is already shipping product to the US and now plans to launch a US website in the next year."

[shanklin] 10/5/2017 12:06

Blimey, looks like Edison paid-for research has decided to pour cold water all over G4M's prospects for the next couple of years. Certainly not what I was expecting when I started reading their coverage.

[iggyb67] 10/5/2017 02:13

Sold today at approx 10% profit in 2 weeks as feel this will dip again in the not too distant future. Be glad to buy in again as did the same prior to the price going to £7 then dropping overnight to £5 so feel there are some controlled pricing here so be gains in the short term.

[runthejoules] 09/5/2017 21:13

Also in SHARES hxxps://www.sharesmagazine.co.uk/news/shares/why-have-shares-in-gear4music-rallied-38-this-year

[rp19] 09/5/2017 20:49

Excellent results imo. H1 2018 may not excite due to the planned investment but if this unlocks global growth then that can only be a good thing.

[martywidget] 09/5/2017 19:19

Small Cap Value Report (9 May 2017) - G4M, TET, WTM
Tuesday, May 09 2017 by Paul Scott

[darola] 09/5/2017 15:12

If anybody is looking for another good retail play, check out UPGS. Recent IPO (6th March), strong board, broad and maturing product line, strong (and growing) client base.

It's started nicely ticking up and has the potential to be a multibagger. 11% rise over the last month.

Interim results from April.

[smokybenchod] 09/5/2017 12:30

Thanks bestace, really useful explanation :)

[bestace] 09/5/2017 12:18

smoky - the outperform on the EPS figure was partly due to tax effects - it looks like Edison assumed a tax rate of 22.6% whereas the actual rate has turned out to be around 12% thanks to some negative 'non-deductible expenses'. That's unlikely to be consistently repeatable so I don't think it's appropriate to expect upgrades just because we've already met Edison's 2018 EPS forecasts.

If Edison's assumed tax rate had been correct, the EPS would have been nearer 10p which is still an outperform thanks to an improved gross margin, but that in itself is partly due to exchange rate fluctuations which may not be repeatable.

That's not to say we won't get upgrades later in the year, but given all the talk of additional investment this year, I'm not expecting major upgrades just yet. It's interesting that their outlook comment is 'in line with OUR expectations' (without stating what those are) rather than 'in line with market expectations'. No doubt Edison will put out a revised note before long which reflects what the board's expectations are.

[bigbigdave] 09/5/2017 11:50

Paul Scott‏ @paulypilot

Good meeting with @gear_4_music management in the City. It's clear they're executing v well. Lots more growth to come, hence high PER.

[smokybenchod] 09/5/2017 11:38

Reading the latest edison note, they were expecting EPS of 9.2 for 2017 rather than the 11.5 reported. Forecasts for EPS are currently 11.5 for this year (2018) and then 14.5 for 2019. Should we expect an upgrade then for this year as we've already met the 11.5 EPS 2018 forecast target in 2017? Slightly confused...

[martywidget] 09/5/2017 10:51

After rising 350% in a year, can this multi-bagger continue its impressive run?
Tuesday, 9th May, 2017

[bamboo2] 09/5/2017 09:07

SCRUTABLE, yes you could well be right. Took a good profit though.

I have no qualms about buying back in higher, if the chart pattern is confirmed.

Only real problem for me is the share price getting too close to the tp before an eod confirmation.

[scrutable] 09/5/2017 09:06

chelwin

The results of opening up in Scandinavia were so outstanding that the next opening in Germany would IMO have been justified if only achieved by a fund raising. It's as justified to capitalise the creation of major increase in retail learning power as to invest in a new production line in a factory. That's what retail does, and it's great that it can expand so fast out of its own cash flow so that the expansion is self-sustaining.

[darola] 09/5/2017 09:05

Just topped up with another £7k. Statistics are too good to ignore. Especially as they are investing for growth.

I particularly like the acquisition of the web development team.

[ramridge] 09/5/2017 08:55

Generally speaking these results are very good and should see the share price rise another leg upwards in 2017. There is little to fault and a lot to like.
The only questionable action to me is the capitalisation of development expenditure of £1.5m . If fed through the P&L account, it would make eps roughly half of stated 11.5p .
But there is a strong argument that the development cost is adding value now by making the platform available to international customers, therefore fully justified in capitalising these costs. I think I will buy this argument.

Operational cash flows and free cash flows are negative but that is to be expected with a fast growing company.

Operational margin 4.6% is low but improving from previous 2.5%

All other financial ratios look good to exceptional.

The real good news is actually in what they call the commercial KPIs. Website visitors, average order value, active customers, etc. All these metrics are better than previous year's. These are the real indicators of value creation.

All in all this is very encouraging and management seem to have a firm hand in ensuring controlled growth.

I am back in. All IMO and PDYOR

[hydrus] 09/5/2017 08:54

Cash burn? What do you mean. It looks fine to me considering they increased stock by £2m and also invested an additional £800k compared to last year.

[scrutable] 09/5/2017 08:44

bamboo you'll probably regret the standard reflex. After the initial profit skimming the share price has justifiably turned up again. It's still a world class performer coming off the recent bottom of its trading range and IMO still destined upwards to 820p short term and of course as a multi-bagger long term.

[che7win] 09/5/2017 08:33

Scrutable, You never mentioned the cash burn.

[bamboo2] 09/5/2017 08:17

Sold my trading shares this morning. :-)

[scrutable] 09/5/2017 08:07

Results demonstrate healthy organic growth without parallel in any retail operation I have ever come across. This is first and foremost the application of brilliant management ie a USP, as there is nothing very innovative about the market's favorite musical instruments.

Crucial figures are the accelerating numbers reflected by Revenue growth of 37%, 46%, and 58% in the last three consecutive years; operating profits, through gearing - rising much much faster

Structural growth is visibly the result of management rather than chance. Software and warehouse servicing ie logistics is clearly being improved continuously A very successful marketing strategy is proving applicable globally and the rate of sales growth is accelerating, encouraged by the opening in Germany of a new distribution centre, which will clearly expect to repeat the process proven so successfully in 2016 in Scandinavia. This huge engine of growth has been just shown to be applicable across any overseas market and is about to roll out at the same time as a new Head Office and logistics improvement is constructed and delivered in York.

A company glistening in a marketing Heaven, which one can confidently expect to outperform as, one by one in the future, it exploits opportunities in the USA, S America and Asia/Australia, all still dormant..

A future global giant of the connected world, already visible, with Amazon like qualities in a much narrower field..

[shauney2] 09/5/2017 08:01

Thats a beat BF

Ahead of analyst expectations and margins are also up.Current trading positive and buying bricks for future growth.

[villarich] 09/5/2017 07:58

Hydrus - happy to be proved wrong. Pre market looks promising. I've a history of being too positive about the shares I own so make a point of looking for negatives ?