Naked Wines Share Discussion Threads

[lindowcross] 23/6/2022 07:09

In today's results, which I admit I have skim read, Naked defines "investment in new customers" (at end of the presentation) as: "The Investment in New Customers during the year, including contribution profit/loss from New Customer sales and advertising costs.". In other words, flogging wine very cheaply via flyers in third party-delivered parcels etc, and other promotions. That can't go on indefinitely.

[lindowcross] 25/5/2022 15:40

Best chance of anyone making money on this would be a successful US listing. It might stumble on for another few years after that.

[jqb1] 21/4/2022 08:58

Please enlighten me, the consensus figure was from their website.

[74tom] 20/4/2022 19:55

What you're missing is that you don't understand the business model... Oh and I also don't know where you get your consensus numbers from as the expectation was for £340-355m...

[jqb1] 20/4/2022 15:04

Really surprised at the bounce here, sales growth is below consensus and cash is down from 57.1 to 40m. Ebit is low single digit. What am I missing?

[arlington chetwynd talbott] 20/4/2022 12:32

I should have added this one to my portfolio, not just my watch list.

[74tom] 20/4/2022 09:59

It's a very interesting watch indeed. Shorts will have to buy back 3.2m shares at some stage & it's a fundamentally sound company with a huge US growth runway. The catalyst with unknown timing is a full US listing. The CEO was dismissive of a 'near term' change as recently as the November half year results, however was much more positive in the medium term.

I suspect shorts will remain in control until then and limit any moves to the upside whilst hoping that their thesis of deteriorating consumer sentiment will cause WINE to miss their 2022/23 revenue forecast. I'm sure they were disappointed that today's update flagged the 2021/22 results as being near the top end of the guidance provided in November...

[bulltradept] 20/4/2022 07:40

Quite a big short position on it too.

[arlington chetwynd talbott] 13/4/2022 12:48

I have added this one to my watch list because the customer experience is so good. Consistently high quality wine for much less of a premium than elsewhere. And the story undoubtedly adds value. Why has the market fallen out of love with it? Seems to be more than just the ending of the lockdown effect. What is the catch here? The figures look okay to me - obviously a very forward looking valuation, but it is hard to see WINE failing to deliver the envisaged growth. Are folk worried about how it will perform in the teeth of a recession?

[arlington chetwynd talbott] 13/4/2022 11:11

I have added this one to my watch list because the customer experience is so good. Consistently high quality wine for much less of a premium than elsewhere. And the story undoubtedly adds value. Why has the market fallen out of love with it? Seems to be more than just the ending of the lockdown effect. What is the catch here? The figures look okay to me - obviously a very forward looking valuation, but it is hard to see WINE failing to deliver the envisaged growth. Are folk worried about how it will perform in the teeth of a recession?

[buywell3] 08/4/2022 08:23

425p tested and failed

[seagreen] 03/4/2022 10:45

The other curious thing I find is that Majestic Wines are mostly fantastic and my experience of Naked Wines are they are deeply disappointing and bland. Not sure you can compete with majestic French reds in the 8.99 to 15 quid range. Although perversley Co op have a very good buying team and their customer base does not realise it so you can get good deals in offers. Majestic still offer a friendly face to face service as knowledgeable as the old Odd Bins team used to be or indeed on the phone. (No interest in stock price just quality wine at reasonable prices.)

[lindowcross] 08/2/2022 06:42

From Retail Gazette,
Majestic Wine online sales skyrocket 300%
By
Elias Jahshan -
June 11, 2021
Majestic Wine toasts record market share
// Majestic Wine says it outperformed the market by 8% since acquisition by Fortress in December 2019
// This accounts for over 5% of all wine sold across Britain and online sales skyrocketed 300%
// Summer 2021 predicted to be Majestic Wine’s “biggest ever” as millions of Brits holiday in UK

Majestic Wine has revealed details of a record breaking trading period over the last 18 months, with some key trends predicted to continue as the world reopens.

The wine retailer said it outperformed the market by eight per cent since its acquisition by investment firm Fortress in December 2019, which took the retailer back to private ownership.

Majestic Wine said its market share now accounts for over five per cent of all wine sold across Britain.

[lindowcross] 07/2/2022 08:15

Majestic prospered because it built a brand established over many years grounded on a solid base of freehold property. Brand markers included but were not limited to: easy to reach locations, convenient parking, knowledgeable sales assistants - many had wine qualifications - building personal relationships with customers, wine tastings, glass and ice bucket loan for parties, wide range including beers, soft drinks etc, then building a net presence when the internet arrived backed by home delivery from its stores, and keen prices. These items differentiated the business from supermarkets and more upmarket wine dealers. It took quite a few decades to build up that moat, and competitors tried to compete, eg Oddbins, but could not. I work near an existing Majestic in south London, and it seems to be thriving. I'm sure it continues to prosper for the private equity buyers who probably couldn't believe their luck. What markers set out Naked Wines which will ensure its expensively-obtained client list will remain loyal out on the wild west internet?

[74tom] 06/2/2022 18:58

Ha. If it was that simple then how did Majestic manage to prosper? People buy online for more than just price...

[lindowcross] 06/2/2022 14:19

Maybe, but the type of wine Naked sells is very price elastic. It's pretty much a commodity, so problematic to build a sustainable brand for it. In the UK if the punter can buy palatable Sauvignon Blanc from Tesco for £7 a bottle, and Naked's is £8.50p a bottle, then over time it'll be Tesco which makes the sales. It will be the same in the USA. In my view, all the "investment in New Customers" will come to naught even if they had been given a load of guff about the provenance of the wine, the grower and her vineyard.

[74tom] 04/2/2022 14:22

No point being invested in something if you don't believe in it. Naked is completely different to Majestic, they're pursuing a long term growth strategy rather than running a mature business paying dividends. Baillie Gifford certainly think it's interesting as they've now got an 11% stake. Suspect it goes lower in the next 6 months but long term I think today's prices will be seen as cheap.

[lindowcross] 04/2/2022 08:46

The "old Majestic wine" used to make pre-tax profits of around £15m on turnover of around £220m backed by a solid base of freehold property. (and send me a voucher for a bottle of champagne every year!)

So Naked for me has been a huge disappointment.

It seems to rush for sales and turnover without bothering too much about profit. Everytime I open a parcel for goods bought on the internet a flyer drops out from Naked offering discounted wines .

The recent results stated "investment in New Customers2 of £21.3 million, delivering a 5-year Forecast Payback2 of 1.7x in a changing market environment as wine consumers sought in-person experiences emerging from COVID-19 lockdowns". I'm not really sure what that means but I suspect it means, "we are flogging our booze really cheaply in order to sign on new customers".

But as I think I posted on a previous WINE board, customers are fickle, and can easily move or suspend their subscriptions or whatever when the gas bill comes in, or someone has a better/cheaper offering.

So I sold my rump holding of Naked yesterday, held since the Majestic days. Notwithstanding this I accept I may be completely misguided. (I presume everyone who plays the markets gets it wrong sometimes, the game is to get it right more often than not!)

The market likes nothing better than to prove an opinion wrong and for the benefit of those who have faith in the company and continues to hold I sincerely hope the future proves I was.

[ny boy] 04/2/2022 03:18

Going the way of many U.K. stocks, unloved and now with interest rate rises here, consumers will tighten their belts accordingly, not a buyer, just on my watch list, maybe some sector consolidation will be beneficial.

[74tom] 03/2/2022 23:03

And why is that lindowcross? Do you think it’s overvalued?

[lindowcross] 03/2/2022 11:39

Sorry to say it, but this company is "all fur coat and no knickers"

[jqb1] 03/2/2022 11:33

Anyone see the virgin wines update? Not good

[playful] 11/1/2022 15:56

Joined you today!

[buywell3] 07/1/2022 08:31

buywell3 3 Dec '21 - 20:39 - 258 of 258 Edit

Present chart set up looks a tad familiar methinks to what has gone before

425p support could be retested imo

dyor