Share Name Share Symbol Market Type Share ISIN Share Description
Gear4music (holdings) Plc LSE:G4M London Ordinary Share GB00BW9PJQ87 ORD 10P
  Price Change % Change Share Price Shares Traded Last Trade
  7.50 4.29% 182.50 57,201 15:36:29
Bid Price Offer Price High Price Low Price Open Price
175.00 190.00 182.50 175.00 175.00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
General Retailers 147.63 5.01 17.80 10.3 38
Last Trade Time Trade Type Trade Size Trade Price Currency
15:51:44 O 10,000 185.36 GBX

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29/7/201803:05Gear4music (G4M) One to Watch on Monday -
09/8/201521:27Games 4 Music5

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Gear4music (holdings) Daily Update: Gear4music (holdings) Plc is listed in the General Retailers sector of the London Stock Exchange with ticker G4M. The last closing price for Gear4music (holdings) was 175p.
Gear4music (holdings) Plc has a 4 week average price of 170p and a 12 week average price of 170p.
The 1 year high share price is 1,020p while the 1 year low share price is currently 170p.
There are currently 20,976,938 shares in issue and the average daily traded volume is 118,285 shares. The market capitalisation of Gear4music (holdings) Plc is £38,282,911.85.
masurenguy: Gear4Music hits a bum note Liontrust’s Anthony Cross and Julian Fosh says Gear4Music (G4M) continues to suffer from a poor trading update despite no new reasons for disappointment. The duo hold the stock in their £183m Liontrust UK Micro Cap fund, where Victoria Stevens and Matthew Tonge are co-managers. They said in their latest factsheet that Gear4Music had been one of the biggest detractors over the past month. Although there was no new news flow on the stock, it ‘continues to suffer the after-effects of its downbeat trading update in April’. The managers said the online retailer of musical instruments has a ‘leading market position in the UK and a growing share of the European market’. ‘It warned on weaker-than-expected consumer demand during February and March, and it is notable that this has been followed by a slew of similarly challenged updates from consumer-facing businesses across the market as the cost-of-living crisis begins to bite,’ they said. Cross and Fosh said aside from Gear4Music, the fund has ‘relatively low levels of exposure to consumer cyclical companies due to its focus on businesses with intangible asset strengths and high returns on capital’. No current position
aimingupward2: Given all the external circumstances I think that G4m has done pretty well and we wll see a significant rerating in the share price in due course.
saracen3: Singers comment Buy target 385p Gear4music (Corp) - Adj PBT of £5.1m was in line with expectations that were reduced in Nov’21 and Apr’22. This compares to £3.3m achieved the year before covid (FY20). Net debt was £24m, after £28.5m spending on the AV acquisition (£11.4m) and strategic investment in stock (£17.1m), which underpins availability for FY23 and provides a competitive advantage vs smaller operators. Given its RCF funding, £8.8m of freehold property and product supplier payment terms (typically <2 weeks), we are not unduly concerned by this and stock levels/ND are already normalising. While expectations were reset in April to reflect weaker market against exceptional comparatives, Mar23 sees G4M launch a number of incremental and differentiated growth initiatives which position it for sustained long term growth. Of particular note is 1) scaling up AV in thppis new and complementary/additive vertical, 2) launching a highly differentiated, compelling and incremental pre-owned proposition and 3) accelerating growth in its European business (almost 45% of total group revenue). In this context, and with YTD trading in line with consensus, valuation looks extremely undemanding on 4.9x EV/EBITDA, reducing to 3.9x next year (c8x P/E). Its all about rebuilding confidence in this growth. While re-rating against this backdrop may take time, the combination of multiple expansion and growth has the potential to deliver significant returns for investors in this next growth phase. Our target price is 385p.
dros1: look at gross margin 46% for Tune vs 27% G4m
rp19: Don't know the rules concerning closed periods, but the most recent transaction was the CEO selling 1.65m shares at £7.30 per share for a total upward of £12m. Nice timing. He still retains 4.7m shares. The vastly reduced forward looking broker estimates are not inspiring and the extent of the downgrades is significant and surprised me. The trend to purchasing musical equipment online I think will strengthen, so G4M should be well positioned but there always tends to be a disappointment around the corner (e.g. Jan '2019 capacity constraints and margin pressures). FY '23 EPS estimates are less than this year's FY '22 estimates and it is supposed to be a growth company (and there has been a recent acquisition which should enhance earnings). The recent update identifies weaker consumer demand in Feb/Mar. Are the estimates prudent and see this weaker demand continuing for some time? If so then perhaps there is scope for out performance but it is firmly in the 'I don't know' category for me at the minute.
masurenguy: Shareprice hit harder than I envisaged. Good decision in hindsight having sold out @£6.82 in mid-January after the 33% fall from the peak last year. Could look to re-enter if the price falls further.
masurenguy: EBITDA slightly - circa 10% - below expectations for the year but general trend is upwards compared to pre-COVID Y/E March 2020. However European sales have been impacted by Brexit/COVID while UK sales continue to grow. This could possibly become a bid target from their major German competitor at this price, which would give them a dominant position in the UK market. We shall have to wait and see. Meanwhile a bit of a profit warning in the commentary, which might punish the shareprice at the open. "Short term inflation-linked overhead cost pressures and weaker consumer confidence across the broader retail landscape will mean the best opportunities for stronger growth during FY23 are likely to be in H2. We are, accordingly, moderating our overall growth expectations for the new financial year, which we believe is the prudent approach in the current environment. During what may be a more challenging FY23 H1 retail environment, sales and margins will be supported with good levels of inventory across our distribution centres, continuing expansion of our European operations to drive European website conversion, and sufficient working capital to continue investing where appropriate."
saracen3: Hasting`s comments. G4M IS A BIG HIT - 22/04/21 There has been a pre-close update from G4M this morning, that paves the way for the delivery of what will be superb full year 2021 numbers. In the announcement, the company has once more indicated a beat on broker forecasts, that were in themselves upgraded on a number of occasions throughout last year. Now, the online provider of musical instruments anticipates full year revenues to come out at £157.5m representing a 31% increase on last year. Additionally, EBITDA is to be no less than £19m which is a 6% beat on broker Singer’s forecast of just two months back. Net cash is also expected to register higher, with the same broker now looking for a £2.4m position which is expected to move further northwards in the new financial year to £5.1m. With Singer now pencilling in EPS of 54.6p for the year to be reported, then even allowing for a rise to £8.50p today, the shares trade on a very attractive PER of just 15. Of course, it is evident that some investors are looking at the expectations for the coming year and indeed the following full year 2023, which shows at present, the shares trading on a more punchy rating. However, from a personal perspective as a holder, I believe the expectations are set very conservatively, whilst whatever the delivery of those transpires, I am looking beyond the near term with undoubted excellent growth prospects on the horizon. To glean a little more as to the last year and the way forward, I again caught up with CEO and founder Andrew Wass, who incidentally retains a very considerable holding in the business. Wass, as ever, with feet firmly on the ground said “The year has been good for us, lots of progress, but some lessons were learnt pretty quickly too, as there were some operational challenges along the way”. Speaking of specific issues Wass says, in particular there was the homing in on how to use the various levers in order to get the business in a great place, which has proven successful, with strong margin improvement a major part of that. With 2021 now in the past the CEO is keen to look to the future, where he says that they are really keen to talk about the next phase and beyond Covid. As part of that moving ahead process however, investors will no doubt be wondering whether the marked and notable improvement in margins can continue on the recent upward trajectory. “I don’t think we will quite repeat what we have done in the past year” says Wass, “but I do think we will retain a lot of the improvements that have been made, so we may not get to where we have got, but I think you will see very good progress”. At this stage of the year and with Covid still causing disruption it is perhaps understandable that Brokers at present, are deciding not to revisit the 2022 numbers, but that will no doubt happen in due course. What does appear clear is that changes were already taking place to the positive for G4M before Covid hit, so the market dynamics remain positive for both the medium and longer term plans. Touching on the coming year and beyond the CEO adds, “its great that we have been so cash generative and alongside that we also have the new banking facility and that will help the next stage of growth. Regarding the facility that we’ve now got, we won’t be using a large amount of that, but it gives us options and flexibility and will make a really big difference. We have never really been in that situation before and I do think that is going to help us in the next year”. Although organic growth remains an absolute key aspect within the operation, Wass says that the main focus of the facility is to provide support for acquisitions and the company has already recently acquired a brand that was previously owned by Marshalls. Although this was a small purchase that did not warrant a release, the CEO says that it was nevertheless a good buy with a rich heritage. “That is something we could do more of” he adds, “so if we could buy some legacy brands that actually have a really good history but have perhaps not done so well of late, we can then do something with them”. In terms of acquiring another player, Wass says that they are less interested in that route and the plan is to incorporate any further brand purchases into their own, which provides for improved margins. It appears a clearly defined vision and roadmap for G4M and Wass says that he sees that direction of also being a good route of building on the margins achieved over the last year. “We would much rather go that way than perhaps purchasing another retailer that may be struggling, as that can bring its own integration challenges.“ Here, the CEO reiterates that they do not want to get distracted from organic growth and within that context he points to investment in their own digital presence along with next years move into the previously mentioned second hand offering. Being an increasingly global operator with a major presence in Europe we also touch upon the post Brexit issues, particularly around logistics and red tape. “It was always going to be a bit of an unknown, but we had lots of mitigation systems in place that have worked very well. But, you can’t get away from the fact that sending goods across borders is more difficult than it was and while it has worked ok, it could be better, which is why we have referenced on building on our existing European infrastructure“;. Wass also says that they have so much more information in place now, that with their digital investment they can scale up quickly with the pay back on that being a fast one. Although a predominantly UK/European operator G4M does have sales in ROW territory’s but Wass says that it is a smaller part of their operation due to complexity of transporting goods of size. That said, he adds that G4M does enjoy sales right across the globe at the smaller size product end of the market. Interestingly, the US is mentioned too, with the CEO saying “eventually we would love to look at the States, but that is a few years off yet”. Looking at the start to the current year, it appears to have commenced well and Wass says that as part of that they have already seen evidence of recovery for products related to events that last year took a hard hit. “Speakers and the PA market, yes, we are seeing much more interest and activity with that, which is what we expected and have been planning for, although we feel there will be a gradual improvement in that as we move forward ”. Although G4M is set to deliver bumper numbers for the year just gone, it is clear that Wass and his team have no intention of getting stuck in the groove. Rather, there is clear evidence that a combination of scaling up on the back of extensive digital enhancement driving organic growth, along with shrewd strategic acquisitions, should keep it well tuned into ongoing and longer term revenue growth and improving sustainable cash generation. Given the ongoing prospects at G4M, the shares are well worthy of my continuing holding for the longer term, which should, all being well, provide for further and potentially significant upside. 53 views 0 comments 3 likes. Post not marked as liked 3 Recent Posts See All SOURCEBIO INTERNATIONAL - WHEN CHEAP MAY NOT PROVE EXPENSIVE - 21/04/21 When a stock trades on a low single digit PER and the shares appear unloved, there is usually a very good reason for such a discounted rating holding sway. In many such situations, the company concern 185 0 6 likes. Post not marked as liked 6 SYSGROUP TRADING UPDATE - KEEPING OPTIMISTIC - 19/04/22 SysGroup, the managed IT services and cloud hosting provider, delivered a pre-close Trading Update to the market this morning that suggested the company is well placed for growth in the coming years. 320 0 2 likes. Post not marked as liked 2 CONCURRENT TECHNOLOGIES EYES GROWTH - 14/04/21 Earlier this week, Concurrent Technologies (CNC) delivered its full year results to December 31st 2020, which came out slightly ahead of broker Cenkos expectations. It was therefore perhaps a surprise 340 0 2 likes. Post not marked as liked 2
hawfinch: @Glavey, all businesses have up & downs. No doubt that G4M has benefited from the pandemic. Given that, I can understand progressive’s forecasts in a lower turnover and EBITDA expectations for FY22+. I can see both the bear and the bull case. Bear case being: lockdown has spurred e-commerce purchasing which many believe is unsustainable at the current levels going forward, thus you should see a natural reversion to pre-lockdown levels or slightly better. In addition to that, from a macro perspective: furlough must end, which will ultimately lead to job losses, higher unemployment, resulting to less disposable income which in turn means less musical equipment purchases (if it does come to that – who knows). Coupled with the fact that Mr. Sunak will have to increase taxes to pay off some of the debt incurred which again, would most likely lead to an amazon tax (in my opinion). G4M would have to pass down the cost to the consumer, making their products more expensive. Finally, Brexit. If you go onto twitter, you’ll see a lot more people complaining to G4M about their delivery times. There are some tweets where consumers highlight that delivery times are taking up to 2 months long for their products to reach them. Now, when things open back up, why would someone wait that long when they can go to a retailer & purchase it (if its available) and for a cheaper price (if the amazon tax does hit). Again, I’m assuming that the item is available at a brick-and-mortar musical store and it’s cheaper. Also I’m assuming the delivery times continue to be a problem. Bull case: Average order frequency will increase with G4M, regardless if lock-down has ended. Many customers will purchase from them again due to the relative convenience, easiness and number of products G4M offers. Also, what’s stopping G4M from becoming the Asos or BOO for musical equipment/instruments? Their conversion rate is already better than Asos & BOOs. In addition, the blueprint for G4M is there. 40% of Asos’ revenues come from its own products & not its third-party suppliers (and this is increasing). G4M, I believe are doing the same thing. I think you will soon start to see G4M creating more of their own products and cutting down on third party suppliers. Finally, in regards to online sales. In the UK, online sales are currently ~28% of total retail sales (that’s not including specific product categories such as music, which I believe is slightly higher ~30%.) I do believe this trend will see a drop, but I do not reckon it will revert back to 2019 levels. There’s clearly an upward trend. I see online sales in future being close to 40 or 50% in the next 5 – 10 years. & As you’ve highlighted, Glavey “there's been some consolidation over time”. My guess is, we will see more consolidation as G4M start to expand (M&A activity etc). As long as ROIC remains higher than cost of debt. Also, bear in mind this is just the UK. Now, if we look at Europe (in 2019) many countries are behind in online sales as a % of retail sales (France & Germany being the obvious). I reckon it’s only a matter of time that before they catch up to UK or even overtake in that matter. Remember, EU represents a £4bn market. I see both cases, but I feel the bull case is stronger. Hence why I am long. Online Data:,_2019_(%25_enterprises).png#filehistory
cooltools: Glavey - how do you see G4M as overvalued? Contrarian/negative views most welcome - we need to keep our feet on the ground! Personally, I see Amazon and eBay as more similar to each other than G4M. Amazon does not curate - all info is entered by sellers and reviewers. G4M curates, that is, it creates the pages for the products it's selling (Amazon is almost entirely automated). Just compare the listings for electric guitars - hTTps:// with Amazon's - hTTps:// - a world of difference, G4M is helpful and guides you though choices, Amazon just displays stuff (mostly sold by third parties through their "marketplace" and "fulfilled by Amazon"). Prices are similar but I suspect G4M has better margins as the cost of getting eyeballs on Amazon to third party sellers is significant (note the "sponsored" - i.e. paid for listings) plus Amazon's cut for selling on behalf of the third party. G4M buys direct from manufacturers, so skips the intermediate third-party seller level. Therefore G4M can price match where competition exists. There are competitors to G4M working in a similar way (UK and Europe), but G4M really know their stuff (LTH since 138p in 2016).
Gear4music (holdings) share price data is direct from the London Stock Exchange
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