The Gym Share Discussion Threads

[masurenguy] 13/1/2020 16:34

Sudden surge in the price on modest volumes right at the close. Tomorrow could be interesting !

[masurenguy] 07/1/2020 08:36

Peel Hunt reiterated their Buy recommendation this morning with a target price of 350p.

[quepassa] 07/1/2020 08:35

Two broker reco's this morning:

1. Berenberg REITERATE BUY with unchanged TP 330p
2. Peel Hunt REITERATE BUY with unchnaged TP 350p


Peel Hunt see 20% UPSIDE to current share price

all imo. dyor.
qp

[mount teide] 02/1/2020 08:30

Looks like some are expecting a strong Trading Update!

[masurenguy] 29/12/2019 00:49

2020 Tip by Peter Evans in The Sunday Times - The Gym Group

According to the accountants PwC there is the potential capacity to support up to 700 more low-cost gyms in Britain and The Gym Group is in prime position to capitalise on this with their experienced management team led by Richard Darwin. They also believe that the business will benefit from its main rival, PureGym, being preoccupied with their recent continental acquisition of Fitness World. Gym has also experimented with small units that are cost-effective in smaller towns, which will enable them to grow their business in areas where larger rivals have struggled. Numis has a target price of 330p, reflecting a modest upside of 15% from the current price and, with other analysts predicting consolidation across the industry, an even better return could come from a private equity buyer.

[thomshrike] 28/12/2019 10:49

A key point going forward is that the competitive moat increases as the company grows. Landlords want to sign with the best operators, it is easier to attract talented staff, bargaining power with equipment suppliers increases, dual membership through LiveIt becomes more effective, marketing costs are diluted, etc etc etc. This means it will be even easier for GYM to gain market share in the future.

[masurenguy] 28/12/2019 09:35

I would agree MT. They have an established and proven existing formula and a promising new collateral opportunity with the new small box concept. Key factor here will be management's effective implementation of the business plan over the next 2 years.

[mount teide] 27/12/2019 13:47

I am expecting the GYM Group to out perform the sector over the next 2-3 years - it's strategy of targeting mainly high population cities and their suburbs is extremely sound. These locations have a high incidence of the young working class who are a natural target for a low cost gym product without the 12 month upfront membership commitment.

The quality and range of the commercial quality equipment available in each GYM Group gym is second to none - easily beating the overwhelming majority of Public Sector run gyms(average cost per month is twice the GYM group).

For youngsters, 30-40 years ago dance halls used to be the place to be seen - thanks to hit mass media TV programmes like 'Love Island' and Z list celebrities using low dosages of highly powerful growth hormones like testosterone for cosmetic purposes, it's now the GYM.

[masurenguy] 24/12/2019 09:22

Looking very positive here - could be back over 300p early in the new year.

[mount teide] 18/12/2019 14:11

Despite the claimed economic uncertainty due to Brexit this year, the low cost gym sector continues to report strong growth - entirely logical when the sector charges between a third to a fourth of the monthly cost of membership at Virgin Fitness and David Lloyd, and a third to a half the monthly rate of most 16-25 year old's mobile phone contracts.

And among the top five low cost gym operators the Gym Group's membership cost is by some margin the cheapest - on average £5 a month cheaper than main rival Pure Gym.

[mount teide] 18/12/2019 13:47

Selling 75% above 300p (fair value) in Q4/2018 and buying them back following the illogical drop below 200p in Q1/2019 worked out well.

Have 350p now as fair value considering the excellent progress made over the last year.

[masurenguy] 13/12/2019 16:37

Second highest daily volume in 2019 and the highest close this year.

[thomshrike] 13/12/2019 16:08

Note that today Pure Gym announced the acquisition of Fitness World, which has operations in Denmark, Switzerland and Poland. Quite a surprising move.
This should be seen as a mild positive for GYM for at least 2 reasons: Pure Gym will see more of their capital and management attention diverted away of the UK; it draws attention to GYM as a possible target of consolidation itself.

[thomshrike] 13/12/2019 15:40

#2 largest daily volume in the year for GYM. With the stock breaking out on the upside, that cannot be a bad thing.

[thomshrike] 11/12/2019 08:37

Very supportive note from Numis out today, incorporating the potential of the small box format on estimates. Even if the impact on earnings will be felt mostly after 2021, the company is trading at more than 2020 10% FCF yield pre-expansion-capex.

[masurenguy] 10/12/2019 12:50

RBC Capital Markets has issued a new Outperform recommendation with a target price of 340p.

[masurenguy] 04/12/2019 10:19

10p spread is crazy particularly with circa 140m shares in issue, and with over half of them held by a number of institutions.

[earwacks] 04/12/2019 10:11

Interesting spread. Quoted £2.695 to buy and yet share price is £2.58

[earwacks] 03/12/2019 17:52

If brokers are 52% wrong and 49% right seems to be a 1% margin of error. Personally I would say brokers are about 80% wrong in the short term. If you give them long enough they will of course eventually be proved correct more often, 10 years maybe? I think they are a tad cautious here baring in mind how short it is of all time high and considering how the business is expanding and the 'surge in income' compared to its best share price last year.Be interesting to hear how their investor day went at the new 'small box gym'

[earwacks] 03/12/2019 17:30

Really strange market reaction to good news again. Same thing happened with CDM, great acquisition followed by share price drop and then the next day woosh. Anyone would think the MMs trying to rattle out a few investors knowing they will make a killing the next day. IT does have very strange moves on low volumes and completely indifferent to the wider market usually. It seems to me they are ahead of the game in terms of their approach to what customers want and need and what they offer. Cant see how borrowing an extra ten million on better terms and opening a new venture, which could be ground breaking, can be seen as anything than positive

[davr0s] 03/12/2019 13:42

Yeah indeed

[davr0s] 03/12/2019 11:23

Not when they are 52% wrong - creates unhelpful bias imo and just offers an unhelpful crutch where people haven't got a trade plan. I trade US and UK markets - one of the benefits of the US is there is much less unhelpful noise over here in the UK but it didn't stop one of my shares selling off for a few days on some broker strong sell note only for it to break out to all time highs a few weeks later. They are unhelpful noise