Scs Share Discussion Threads

[sphere25] 09/12/2020 10:01

Is it going to breach that key mark now with the price at 202?

43k on the bid at 202. Someone is keen. Don't often see that with SCS.

[sphere25] 08/12/2020 10:33

Nice move from when highlighted at 182p

Test of £2 coming up with the offer currently at 201. It's key resistance this, usually bounces off it but you can see the short term trading opportunities in this one as per the posts above.

All imo
DYOR

[davidosh] 07/12/2020 15:36

Unless they are really big director purchases by non execs I think most investors only really take notice of executive director purchases and even then it needs to be a decent part of their overall remuneration not just token gestures.

The company could buy sensibly at this level to cover future awards to the management team and prevent future dilution

[mickeytt] 07/12/2020 14:23

this sector all about payment terms. UNO went bust after reporting cash pile bigger than mkt cap

[essentialinvestor] 07/12/2020 09:48

There are 5 other members of the BOD.


Aware the CEO is departing.

[davidosh] 07/12/2020 00:48

I have met management and certainly the situation in 2007 was very different to how we stand now.

We are about to see the current CEO retiring so as he already has a large holding and his life tied up in SCS then I really do not think he should be buying even more shares. The new CEO may well want to buy some but he has not yet taken up his position and probably wants to see the company in operation before investing significantly.

Scion selling is really just a minor adjustment but if they sell further then the broker or company need to get into action and I would want to know what Scion have as their reason to exit. Maybe they somehow think all of UK retail has problems.

I am hoping to get the SCS management to my Mello on the 21st December so stay tuned

[essentialinvestor] 06/12/2020 16:52

I would not not read too much into Scion marginally reducing,

unless they continue to sell down their holding.

[essentialinvestor] 04/12/2020 16:40

Just thinking out loud here and any caution may be misplaced,

so very much a case of DYOR.


I'm gussesing David has met the management team so his view perhaps more

informed than mine.

[joemillson] 04/12/2020 15:56

I share your concerns (by the way I do hold quite a bit of SCS).

It’s cash generative yes, and sits on a pile, so what’s the new boss going to do with it? Buy backs and Director buying recently would have been a good sign.

I’m nervous - new CEO and Scion selling only months after buying in.

[essentialinvestor] 04/12/2020 15:22

David,

in it's previous stock market incarnation, ScS also had a very large cash balance

in 2006, it was in administration 18 months later.

Bought by the private equity firm who recently sold out.

In the interim I'm sure many changes have been made and hopefully lessons learnt.


It just makes me a little cautious though, perhaps unfairly so.

I don't see directors adding recently and wonder if the pent up demand story

for certain sectors is about to come to a halt?.


If anyone has any thoughts on the above/or a different view, would be interested to

hear, thanks.

[davidosh] 04/12/2020 11:08

If they want to sell more then maybe SCS can take them out at this low level and put them into Treasury ready for an institutional buyer later as the company has plenty of free cash. Ideally the broker should be trying to get a new investor in if Scion want out.....maybe it was just a trim.

[sphere25] 03/12/2020 17:54

You're a savvy promoter ;-)

*UPDATE*
RNS the following day to show who the seller is. Scion have trimmed moving from 5.07% to 4.71%. It's a wait and see how much they want to lob and at what price.

[davidosh] 03/12/2020 17:07

Sphere....thanks for being honest and I certainly agree about some of the rubbish spouted and there are quite a few over promotional directors....certainly not the case here at SCS as I have met the directors.

You would certainly enjoy the BASH (Buy, Avoid, Sell or Hold)panel session and you can enjoy SCS being discussed in the September one.....downloadable on our website. The largest shareholder was promoting his fund in that show too.

[soleman1] 03/12/2020 16:59

I also added today, could be the bottom but if not ill just add more on the next drop either way this is crazy cheap and will be much higher hopefully some of that cash mountain will be returned to shareholders in due course.

[davidosh] 03/12/2020 15:29

Sphere25.....Have you been to one of our MelloMonday investor evenings? I am happy to offer you a free ticket to our Christmas show which is available to watch after as a recording over Christmas as it is 6.5 hours altogether

We have some great presentations lined up and you would enjoy the BASH panel session. There will be over 600 investors at this one. We have nearly 400 annual pass holders.

[sphere25] 03/12/2020 13:52

I was looking around the market recently and it's hard to find anything that stands out. Noted this had fallen, been watching it for years. Proven itself to be more resilient in recent years than in the chequered past (better reputation?) so kept it on the watchlists for opportunities because it is prone to illiquid moves like this.

Chart did bounce off strongly from these levels previously so a possible bottom. It looks like there is one seller at work here who has had to bring the price down to these levels to clear some lines of shares. It also explains the narrow spread.

Small iceberg was sat on the offer at 182 (took some there) which looks cleared, now shifted to 182.5 but with a 845 block but only allowing small buys at that price. 183 for any normal market size like the recent 5k and 3k prints, but 3-4p through the offer for anything more.

It forms repetitive patterns where there are some lines of shares to clear but once they're gone...bang! It just spikes back higher.

On your point of institutional demand in the future, look at how hard it is to buy these from a small fish private investors view, if new institutions were trying to accumulate in any size here on the back of a much improved fundamental picture, this would go bonkers higher. It lurched from 180 to 220 in a flash earlier in the year.

Possibly in future? One step at a time. Let's see how it goes. Just saw it as a decent entry point to begin some accumulation.

As always, just an opinion

DYOR

[terry236] 03/12/2020 13:39

A very tight spread today! I believe that come FY results we will be back over the 2.20 mark, very undervalued IMO

[davidosh] 03/12/2020 13:20

Sphere25....I totally agree. I have added a reasonable number today at £1.82 as I am calling this as the bottom. The EV is crazy low and if they can show that the online business can get nearer to the level of business done online by DFS then there will be a huge re -rating as we are a much better funded operation with zero debt unlike DFS.

Institutions will start buying in at some point....probably when the business is above the £100m market cap level and liquidity improves. The dividend coming back will make this a very good yield stock for the Income funds too IMO. On Stockopedia the Stockrank is 87 so in the top 10% of listed companies

Quality55
Value79
Momentum80
StockRank™87

[joemillson] 03/12/2020 12:33

Concerned about the new CEO. Wasn’t at Holland and Barrett long - anyone with more info? The press release was a bit lightweight. He specialises in all parts of store network optimisation and innovation - meh!

(I’m an SCS owner)

[sphere25] 03/12/2020 11:54

Picked some up here. Fallen from £2 unnecessarily imo. The last lockdown showed how resilient the trading here was with a strong bounce so I'm buying on the basis that prior result will set the precedent for another bullish period of trading and a recovery going forward.

The cash pile clearly provides reassurances and downside protection but looking at even EVE today. That has been a complete dog and even they are upgrading numbers and alighting to favourable home trends.

This hasn't priced in much of a longer term recovery, let alone recent trends. The price actually hit £2.20 earlier in the year, and now that we have a more bullish environment, it is down to £1.80. Seen as most things are overbought, nice to have the odd one that is unloved.

All imo

DYOR

[davidosh] 03/12/2020 11:44

I honestly think we will start seeing upward movement from here.

I have invited the company (and particularly to introduce the new CEO) to do a presentation at a MelloMonday after the results in March. The share price should be at least 50% higher by then if trading continues the way it was pre lockdown.

[thorpematt] 27/11/2020 20:23

David,
We're deliberatly not commenting as we are all trying to buy more before it bounces off that lower trend line.

On a serious note I do think that the company's cash / debt position is not understood by the market. Essentialy the EV is inflated due to its long term leases being listed as debt in accordance with the new IFRS16 standard.

Once these are taken out of the equation, the balance sheet is extraordinarily strong. I think a protracted focus on home working and decreases in foreign holiday / travel, give tail winds to SCS for a protracted timeframe. I think that even without those, this is a remarkably cash generative business, with its (true) EV much lower than its MC, its true EV/PBT ratio is incredibly low.

The SII have dropped significanlty of late. To put things into perspective, the current cash pile is enough to buy ALL of the 38m shares in issue and still have £40 left over!

Interestingly (as highlighted very well in this TS), people in this sector like to try before they buy (otherwise why would orders fluctuate s absolutely in line with lockdowns). If the market believes that SCS's long term out of town leases are indeed "liabilities" in the literal sense, then I believe that it really doesn't understand the premise under which this type of business operates at all.

For me, this is another example of a quality business whose share price has NOT reacted in line with any sensile analysis of mid to long term prospects. I think the market is too wrapped up in buying some very questionable "vaccine-recovery" stuff. In the meantime some serious once on a lifetime opportunities are being misssed.

So hopefully you all grabbed a black friday bargain today?

[davidosh] 27/11/2020 16:05

No comments on the update?? such a quiet board and yet the company has more cash than its market cap...

[essentialinvestor] 19/11/2020 17:37

* Headlam today.