Headlam Share Discussion Threads

[purplepelmets] 18/1/2024 07:13

Was expecting a warning. Should be a good day after this inline statement

[catabrit] 20/12/2023 17:14

Just wanted to say kudos to Eric for publicly changing his mind when the facts warranted it. It is rare to see that kind of ownership on these forums so big thumbs up from me.

[cjohn] 14/12/2023 15:36

The "bowl" is in the eye of the bebowlder.

Utterly useless as a predictor of future travel.

[volsung] 14/12/2023 15:09

This is one of CR's bowly shares
Not all of them come good but this seems to be going in the right direction
In at 213p

[essentialinvestor] 14/12/2023 09:30

Are current financial conditions more challenging than the GFC..?

Add 14 years of inflation and that £22 million pre tax In FY 2009, equates to over £30 million in 2023.


There looks little doubt to me.

[sphere25] 14/12/2023 09:18

Investors will clearly have to decide whether there is some structural change here.

Unsure if Powell has swung sentiment in the smaller caps here last night, but someone has stuck a 130k buy order on the bid at 205p here. Can't recall seeing that before at HEAD - someone is keen.

Haven't bought back in on that, but interested to see if the market bids the price up on the back of that order, or there are still sellers willing to sell through that order. If so, how big is the buy order at 205p.

Let's see.

All imo
DYOR

[essentialinvestor] 13/12/2023 15:44

Sphere,

In FY 2009, so the teeth of the GFC, Headlam made £22 Million on pre tax. From memory FY 2010 was a bit lower (Would need to check) but still well above where FY pre tax estimates are now

What has changed over those years to result in such an arguably poor profit performance..?

There looks to be a secular element here to me, as well as a cyclical one.

[sphere25] 13/12/2023 11:01

Comment from Peel Hunt below, but clearly it would be worrying if "sales" were going to fall by £1m to £11m:

"Flooring group Headlam (HEAD) is trading below net asset value (NAV) after a tough period, which Peel Hunt says shows the potential in the shares.

Analyst Charles Hall reiterated his ‘hold’ recommendation and target price of 250p on the flooring distributor, which fell 4.7%, or 10p, to 201p after a full-year trading update on Tuesday.

The company suffered a weak period in September and October but there was some improvement in November although ‘volumes remained below the prior year’, he said.

Hall reduced his full-year sales forecast by £1m to £11m and is expecting ‘modest improvement’ in full-year 2024 to £12m.

‘Trading conditions are challenging, given the pressure on the housing market and increase in rates,’ he said.

‘The company has a number of self-help levers, which should enable improvement in future years. The shares are trading below net asset value, which demonstrates the potential value.’"



It clearly isn't great going from a bottom line of £11m to £12m. It is all low growth so perhaps it will be a while longer before the market gets its bullish boots on companies like this. It might explain why the market only has a tendency to have some relief type oversold bounces in particular shares without then having proper follow through momentum.

I don't know how many rate forecasters are out there, and who is going to be right, but noted one yesterday showing rates at 4.5% in 2024 falling to 3.5% in 2025.

Maybe we have to work further through next year to get closer to the market looking forward to 3.5%?

Don't know, hard to time this stuff. The easy thing to spot will be when buyers start moving in big here with continued buying momentum.

And that is just where we are in the UK right now.

All imo
DYOR

[cjohn] 13/12/2023 09:40

I've bought several times in recent weeks with the shares trading at a significant discount to tangible asset value.

I'm a bit surprised by the very negative reception to the update on here.

(Nor could I find the quote about the Company claiming they'd do better than last year's £38m profit. Was that from well before the Final results?)

As I read it, there's been little change since the last update, though there are several indications that cash generation has improved, which will lower debt again, though likely not enough to lead to a net cash position.

I'd have thought that what is required here is patience: we know their market is currently in the doldrums, but that will surely change in the medium-term, unless we enter a depression, which seems unlikely.

[eigthwonder] 12/12/2023 18:25

Peel Hunt (rhyming slang?) are one of the worst offenders for the creeping downgrade for their corporate stocks

[bda3490] 12/12/2023 17:34

Second half lower than first !!!
Total nonsense. They were supposedly going to beat last years £ 38 m profit and have not issued a single profit warning but “hope” to achieve £ 10m profit this year!!

Gained market share accordingly to “research̶1;

As my ex wife said - even your lies aren’t true !

[my retirement fund] 12/12/2023 10:58

Looks like its recent lows were justified.

[castleford tiger] 12/12/2023 10:29

with the dividend cut from 6.2p to 4p at half way i doubt it will be maintained.

tiger

[sphere25] 12/12/2023 08:19

It is another warning - "broadly in line". That is usually code for a small single digit downgrade. Out of the trade at 205p, but the market knows about this kind of update. HEAD have form recently in putting this kind of update out - tough macro.

This isn't new news so it will be interesting to see the reaction. Still to see companies ping higher positive, from an initial morning sell down, post a veiled warning or outright warning.

LUCE eventually got bought up, CTO bounced intraday and CRST didn't fall away on their downgrade in November. Can't recall too many though.

But yeah, let's see as and when the market does take kindly to this kind of update.

Price off 6% at the moment.

All imo
DYOR

[eigthwonder] 12/12/2023 07:55

the flurry was inspired by CEO share purchase and LIKE statement. Don't think the CEO would have bought unless he thought the dividend was going to be maintained, which means it yields quite a lot

[se81] 12/12/2023 07:41

Was thinking that reads like the worst is possibly over? Definitely some rays of light and another £8.6m on the cash pile

[purplepelmets] 12/12/2023 07:25

Was expecting better after the +ve share price movement leading up to this TU. Ho hum

[mdt2] 08/12/2023 17:52

Tuesday 12th

[essentialinvestor] 08/12/2023 17:09

Usualy a pre year end trading update?.

[sphere25] 08/12/2023 16:36

Hopefully the sector experts, or those who have their heads in the reports alot more than me, can provide the detailed fundamental insights. I am only here for a trade, but seen as you mention it, I think that VCP is a wrong-un.

Mentioned it a few times in the past. There is a really bad smell around that company. We can trade anything short term, but that VCP would be highly uncomfortable to hold.

I know nowt, but I'm a really interested viewer from the sideline at VCP. You don't learn much from the really good uns, it is those bad smelling ones that teach alot.

Really, really want to see if something does eventually come out at VCP.

But that is my one penny (inflation adjusted) opinion.

All in my penny opinion
AIMPO
Should use that in future
DYOR

[bda3490] 07/12/2023 19:39

It seems Victoria plc is the share to go with in flooring
Likewise no
Halstead no
Headlam ?

[sphere25] 06/12/2023 12:19

So LIKE didn't warn today, even mentioning a record performance month in November. The buyers came in early here on that with notable bids on the order book from 197p and slightly above. Normally nothing happens in HEAD on a morning - usually takes a while for the book to populate and the spread to come in.

So maybe the CEO buy here at HEAD is also suggesting trading isn't as bad as feared of late. I was torn about having a go here, but then the CEO bought, and that buy might end up being a signal.

It is still too uncertain. It isn't like the price here and elsewhere in smaller caps is on some charge - relief type bounces and more stalling now. Just a little trend here emerging, could just be a bounce, but I will hang on abit longer and see if the buyers keep coming in. Lob abit higher from here if the buyers keep coming and then sit and see how trading has gone into year end and develops.

It will be pants, but maybe pants is already in the price?

All imo
DYOR

[sphere25] 28/11/2023 10:03

CEO buy could be signalling the bottom being close too?

I'm in for a trade.

Have to give it a little go on that CEO buy. The buying is picking up too (e.g. 65k @ 190p) and the chart is starting to curve higher here, so if the buying continues here, a technical trading bounce as a minimum.

All imo
DYOR

[pireric] 28/11/2023 09:51

It's a sign that there isn't a November trading update coming thos year and that shadow broker warning from last month will suffice