Henderson European Share Discussion Threads

[sporticus] 17/2/2006 20:22

Goonertune
He says he thinks its the tip of the iceberg. He says this is a voluntery scheme to lose 10/20 warehouse staff then they will come in with the big guns and at least double it and do the same with the other support depts and about 50 bad shops. He says theyre worried about the world cup and the drought and a dry summer which will be a problem. He also said retiring Musparatt will stay in his company and in control because its in his life now and he needs to justify staying there. He says that his shareholding is to big to let go of the rains. Goonertone, sorry for being a bit thick but what is a cross trade?

[goonertone] 17/2/2006 15:49

was wondering what that cross trade was doing there?

[nick] 17/2/2006 15:46

Time to rock and roll!

[goonertone] 16/2/2006 21:42

Redundacies are a mystery until you know the reason why.

Could be good, could be bad who knows.

GT

[sporticus] 16/2/2006 18:39

Goonertune, I think it may be a silence of the lambs.
According to a Polish friend who used to work there the Peterborough evening paper reports there will be 20 redundancys in the warehouse.

[goonertone] 16/2/2006 07:54

All go on this board and the share price for a week and then silence, though some might say silence is golden.

No company specific news due until trading statement early mayish so probably just a case of people building or altering positions prior to them unless one of the major institutions decides to stir the boardroom up.

I'll go back into hibernation for a while then.

Gt

[she-ra] 13/2/2006 09:16

michaelmouse - "historic". It means nothing when the whole environment is changing for the DVD market and when HEC posted a loss of £3 million.

siwel100 - Yes I know illegal movie and music downloading is massive,it's just I dont want to be fined for doing it

[siwel100] 12/2/2006 23:06

she-ra, no problem having a view. Why dont you short this current bounce? The RSI is starting to look overbought so it should suit you fine. Everybody else will of course be dip buying all the way back up but you can be the resident contrarian.
I noticed you pay 59p to download a music track...why?...most people with any sense download their music for free. If you want some decent and reliable sites or want some free software to crack and copy film dvd's I will put the links up for you.
You seem to muddle up strong views on the future with what happens when trading. Sadly you will learn that you can be both very right and very wrong at the same time. It will cost you to learn the lesson but once learnt you will focus on the market and not your own view of the market.

[michaelmouse] 12/2/2006 21:07

she-ra - I've already addressed your question. The historic p/e (last 7 years) is around 4. IMO the shares are and were oversold and hence my interest. I'm not looking to hold these shares for 10 years but the bad news is already in the price.
In 2002 I bought shares in Big Food group for 39p. If I remember correctly at one point the shares fell so that the were trading at a market cap around 1 weeks sales. I also seem to remember that BFG carried far more risk because of its gearing. However, the company began to recover and the share price shot up to circa £1.80 and I believe it eventually succumbed to a bid by Baugur (around £1). IMO BFG was in a far worse position in every way than HET but it had clearly become ludicrously undervalued. There are many such examples.
If you are short on HET then good luck but I am a patient investor and prefer to be a holder.
Cheers.
Michael.

[she-ra] 12/2/2006 20:29

michaelmouse - And what about profit?You see companies have revenues of billions and still go under if they arent operating profitibly.With the World Cup this summer and the increasing new entrants into an already crowded and saturated DVD retail market,are there really reasons to be optimisitc?

[michaelmouse] 12/2/2006 18:26

A final word from me on the 'value' argument - HET's current market cap. is about 4 weeks sales. Anyway suit yourselves. IMO you either get it or you don't!
Regards
Michael.

[michaelmouse] 12/2/2006 17:42

"Just to correct one fact without wishing to become embroiled in personal mud slinging - net assets are not as good as they look - they are all fixtures and fitting so are only worth a small fraction of book value. Freeholds are only about £1m out ofthe total."

insidenews - Are you saying that the NAV isn't around £1.00? I think you'll find the balance sheet says differently. In other words you are not correcting anything at all. I appreciate what you are trying to say but please be careful with your wording. The NAV is circa £1.00. Fact.

Regards.
michael.

[goonertone] 12/2/2006 16:44

You can find hundreds of articles on the net showing that the market leader itunes make hardly any profit on their downloads and that they just use it as a loss leader for the i pod itself and as a hook to move people over to the mac.

Other big names like Napster haven't been able to turn a profit despite millions of downloads being made.

a few examples both old and new relating to the download business:







As for Music downloads and HEC I think, despite your supposed insight into the way I think, that it would be a waste of resources and time. If they sold cd's then maybe but as they dont then I cant see the point. Movie downloads as and when they finally come in would make sense as they are in the current sphere of products.

The only way I can see it being worthwile is if they use their website and its membership to link to another company like they do with lovefilm and they get paid for the traffic they provide.

GT

[insidenews] 12/2/2006 16:12

Just to correct one fact without wishing to become embroiled in personal mud slinging - net assets are not as good as they look - they are all fixtures and fitting so are only worth a small fraction of book value. Freeholds are only about £1m out ofthe total.

[she-ra] 12/2/2006 15:34

goonertone - You keep saying music downloads are not profitable and yet you provide no evidence to support this claim.

As for HMV, it is half a book store that being Waterstones. As for them not being hit by downloads I think you will find that they moaned about piracy, free newspaper DVDs and downloads. However HMV is embracing technology such as music downloads:-



Yes of course music downloading companies do not have to keep stocks of CDs which IS unprofitable.Of course they are not profitable.Of course they arent passing some of the savings on to customers which is attracting more and more to downlaods. Of course not.


Current market capitisation means nothing when a company becomes indebted, loss making and hammered by competitors of the old and new types of products.


I know full well that if HEC was to enter music downloads tomorrow you would say it would boost HEC.

[goonertone] 12/2/2006 13:41

I think everyone here is agreed that the advent eventually of movie downloads will have an effect on HET. However they are at odds over the extent of this effect.

An interesting parallel to look at is HMV. This high street music and dvd retailer and owner of waterstones is a company that should be on its knees following the uptake of music downloads if the doommogers are to be believed. However although it has been affected it has not fallen over and gone out of business. It now has , alledgedly, 3 bidders for this supposedly outdated concept.

The offer is likely to top out at 200p which values the company at £800 mill for a price per million of turnover of .42p applied to HET this would give a price of £58 mill. Knock 30% of for the rental part of the business leaves £41 million.

Current market cap - £11 mill

Food for thought.

GT

[goonertone] 12/2/2006 12:48

Dear all

Here it comes - "I agree with she-ra" and accept that they have a valid point, our only argument re downloads is when and how much of a mass market it becomes. All I can say is that mass market penetration, wont be tommorow, next month or even this year.


My other slight argument regarding music downloads, which I accept is big business I have never denied it, is who makes any money out of it and I would have the same reservations about movie downloads.

Anyone who has read any of the postings over the last two days will have to make their own mind up about where the future of movie formats is going. All I would say is do your own research, draw your own conclusions and then apply what you find to HET's business model.

As a starter if anyone wants to read up on blu-ray and HDDVD then you could do worse than visit



Which has an overview of Blu-ray and sonys vision for it and links to several articles on the blu-ray v HDDVD debate.

GT

[michaelmouse] 12/2/2006 12:10

Here is an abbreviated investment argument as I see it.

Net asset value circa £1.00 (all tangible assets).
P/E ratio 4 (based on average last 7 years earnings - earnings varied between 10p-20p).
No long term debt.

What will happen next?
1) Company adapts and recovers from recent disappointments.
or
2) Company becomes a bid target.
or
3) Survives but earnings fail to recover to previous levels.
or
4) Company goes bust.

My rationale for investing is as follows. Option 4 is unlikely in the near future since the company has no debt and strong asset backing. Option 3 is already factored into the share price Which leaves options one or two.
I have no idea what the future holds for this company but then neither does anyone else.
Good luck!
Michael.

[she-ra] 12/2/2006 10:02

goonertone - You havent a clue. I download all my tracks for 59p a track from Woolworths. I can cherry pick from albums of the past and albums of today.The singles chart has a had resurgence because of downloaded music.You can be a download deniar till you are blue in the face but music downloads are the pre-cursor to movie downloads (and of course you will get your porn).Music downloads and the popularity of them have aclimatised us to this format.You dont seem to realise that companies like Sony spread their bets. Blu-ray was obviously concieved for the gaming industry.6GB would make the opportunities in gaming software unbelievable. So even if the DVD has lost its popularity it WILL work for Playstation and the added copyright protection is vital for gaming. I see Sony,now even before movie downloads,with the RDR-HXD910 which has 250GB with 428 hours of recording time putting its faith into the non DVD format.Companies like Philips,Sony and Panasonic are creating the hardware for these new opportunities.Dont forget Sony has a vested interest in downloads-they are also a music and movie publisher.

I suppose you are going to start denying that the PC even exists next.




6040 - I dont do aliases.

[6040] 12/2/2006 08:58

She -ra

Why do you put so much effort in to bashing this company?
If you were short on it, surely you've made your money by now. Isn't it time you moved on and tried to drive some other sp's down.

Do you also post on the AEN and CBM threads under the name of Biswell?

p.s.
Could you please take all your A.K.A's and nip over to LLOY, I'm short on them and they are refusing to go back down.

[goonertone] 11/2/2006 23:26

She -ra

This is the last post on this matter as I have managed to get myself dragged into an argument with someone that I would not normally bother with. If you feel that is a victory so be it.

I will leave others to bite if necessary. I have answered all your questions and arguments and got no real answers other than on music downloads. As the original argument was on dvd's then I consider that you had no argument on the main questions.

As for downloads then yes they include them in the charts and that is whether you have to pay, they are discounted or free. Hence the arctic monkeys getting to No 1.

I-Pods are selling at a phenomenal rate and are full of peoples CD collections and swapped/file shared files. Due to the size of the files it is one evenings work to download an i-pod/MP5 player full of music from Kazaa or the like.

So yes I agree downloading is the future but the only genre that will make money out of it is the only genre that makes billions out of the internet already which is porn. Until the music/movie industry can make it socially unacceptable to buy music/films from the high street or acceptable internat sites then the only people who can charge normal or premium rates for content is porn.

If you cna give me a company that I can invest in that makes legitimate money from music downloads or from movie downloads then I'll invest in them as well. Until then I will go with the 3- 5 years that HET has got to trade with before downloads or the next big thing has reached a decent level of penetration.

Next time I want to invest my money I will go and check with the teenagers and 30 somethings whether I am doing the right thing or not. However whether they will understand the question is another thing entirely.

GT

[she-ra] 11/2/2006 20:46

goonertone - Yes the charts dont really count downloads when they are compiling the singles charts,iPods havent really been selling at a phenomenal rate and Google isnt really pioneering the video downloading market.

Yes RIP downloads.You tried your best but we all dont want cheaper music and movies.Kids to 30 somethings arent really downloading music.No, they got it wrong, what a waste of investment by the big record companies. Im sure the movie studios wont make the same mistake.

[goonertone] 11/2/2006 18:56

She -raaaaaaaah

You are now showing yourself to be a pathetic idiot.

attacking me on music downwloads was the only response I wanted.
Nothing on the important points but just a sad attack on an already failing product.

I am going to say this only once music downloads are not the answer to anything. They thought it was the holy grail and then realised that who was going to make any money out of it!!!!!!!!!!!!!!!

Answers on a postcard....... oh I Tunes Ok I've given you that one


GT

[she-ra] 11/2/2006 18:39

siwel100 - World Cup 2006.

140-150p, because some Swedish speculator who has bought into some turkeys, such as Gaskells, has decided to have a bet on HEC?. Look at Tandem, he has done nothing for the share price.

The fact remains HEC is loss making and operating in a rapidly changing market. On the one hand there are new entrants regulary entering the DVD etail market, on the other movie downloads and the constant growth in on demand satellite and cable customer numbers are hitting and going to hit even more companies like HEC. Then you have the fact that newspapers do free DVDs every weekend. People only want to watch so many movies a week.

Once this company starts to become in debt, and one has to wonder whether this will happen with store refurbishments and continuing losses, it will become a very unattractive share.

Your theory about no one selling is deficient. If someone was to start dumping the shares they would crash even more. There is also the fact that they will be holding with a big loss. The fact is many companies go under with very few shares changings hands in the run upto collapse. Mayflower Corporation was just one example. Infact the directors were buying shares prior to administration and there was a Bermuda-based investor who had built up a large holding and he neither made a move to buy the company or to sell his shares.

Someone has got to be holding shares when companies go under.

[siwel100] 11/2/2006 16:45

bletherer....Have a look at volume over the last two years, its non existant. "The market" also includes holders of the stock. If it was thought to be terminal then the holders would have and would continue to dump. The price has fallen on simple illiquidity. The difference now is that the company is back in play rather than declining on minimal trades and lack of interest. The first step is a bounce to 140-150p, beyond that its up to the company developing, performing and showing opportunities for future growth.
Above and beyond discussion regarding the future impact of technology on the company, HET is a simple trading play, I doubt very much anyone particularly wants to hold for 10 years, but simply to benefit from a bounce to fair value.