Scs Share Discussion Threads

[farrugia] 14/6/2021 08:43

when is the next trading update?

[brucie5] 10/6/2021 17:11

Great move today, and particularly instructive since off the back of peer business DFS. Paul Scott is very obviously a fan, and tends to know his way around the balance sheets of good retail businesses. The chart suggests break out.

Looking back to my post of April 21st, when I bought in, it looks to be within spitting distance to my relatively unambitious short term objective:
--------------------------------------------------------------------
Brucie516 Apr '21 - 15:58 - 365 of 390 Edit
0 1 1
I think £3+ is a good call for this medium term. It has both momentum and value on its side and should be a beneficiary of consumer spending. I'm trying to recover what Paul Scott said about in on his most recent coverage, but I'm sure he saw it going significantly higher, or else being bought up by a VC on basis of all the cash.
Over £3 would be a near 20% gain, and that's what I'm looking for within next six months, together of course, with a small dividend. shall we say, 25% all told?
Good enough for 12 months. I bought in towards end of March and have just added for the BO.

GLA, NAI, DYOR, of course!

[davidosh] 10/6/2021 15:20

Some very useful commentary on DFS and comparing with SCS by Paul Scott in the Small Cap Report...

Supply constraints - seems to only be causing delays, rather than anything more serious -

Our revenue growth in FY21 has however been constrained by sector-wide pressures on supply chains from raw materials availability, container shipping delays (including the effects of disruption in the Suez Canal), and Covid-19 disruption of factory production. Therefore the majority of the revenues and profits from our strong final quarter of trading will be recognised in our FY22 financial year.
Dividends - a 7.5p final divi is expected to be declared in Sept 2021.

Dilution - due to its awful, painfully weak balance sheet, DFS was forced to raise more equity during the pandemic. Therefore, note that the share count is now 258.4m, well up from the pre-pandemic level of c.215m. That curtails the upside per share.

Whereas smaller rival Scs (LON:SCS) (I hold) which has a bulletproof balance sheet, didn’t need to raise fresh capital, and should therefore have better upside per share. Plus SCS shareholders could sleep soundly at night during the pandemic, whereas DFS at times looked to be in a dicey position. I like to make money on shares without having any worries about insolvency.

My opinion - DFS is a really good business, no doubt about that. It’s performed remarkably well in such a heavily disrupted year, showing that lockdowns have not impacted demand for furniture, just caused delays which are quickly recouped when showrooms re-open. Plus people spending more time at home, seems to drive up consumers desire to revamp our homes.

My balance sheet concerns remain, and the weak finances resulted in material dilution during the crisis, showing the folly of running any business on a negative NTAV balance sheet (substantially so in this case). Management clearly have not learned any lessons from this, as they're re-starting dividends.

I think Scs (LON:SCS) is a much better, lower risk proposition as an investment, since it’s sitting on pots of cash, and trading well, at a bargain rating. There should be read-across from upbeat figures today issued by DFS. Hence DFS being up 12% at the time of writing, looks justified from this strong update today. Read across to SCS (I hold) hasn't happened, and it's down 1%. There's an obvious mismatch there, so I'll be topping up SCS when funds permit.

A remarkable share price recovery at DFS, which I think is justified by strong performance.

[farrugia] 10/6/2021 08:05

bought some more following the results of DFS but there seems someone on the other end offloading. Could it be the Church Commissioners for England?

trustpilot reviews are impressive too

I'd buy more if i could.

[netcurtains] 10/6/2021 07:46

I sold a month or so back but might come back in at some point.

[harrogate] 10/6/2021 07:38

DFS numbers this morning look spectacular and must suggest SCS is flying at the moment.

[davidosh] 09/6/2021 10:02

That will certainly account for why the share price has been drifting downwards in the last few weeks. I wonder if they are going to continue selling or was just a decision to reduce by exactly 20%?

[brucie5] 09/6/2021 09:37

CoE reducing. Not sure that's the wisest move, but still.

[brucie5] 03/6/2021 14:24

First of Paul Scott's Value shares on PI World.

[deadly] 17/5/2021 18:35

Nice sharp drop before close let me add some more at 259, before going higher.

[finkie] 10/5/2021 12:43

whats the view here then? any news flow due from scs soon?

[thorpematt] 05/5/2021 19:36

High tight flag. Continuation pattern. One of the highest probably trades there is.

[brucie5] 05/5/2021 16:56

I look very favourably on this kind of retrace, which suggests consolidation above the previous range. This looks to be well overlooked, and I daresay Davidosh your buy may prove to be shrewdly timed.

[davidosh] 05/5/2021 16:39

I managed to buy some more at £2.67 and I think that when the company next updates then that will look to have been a good price.

It currently sits at £100m Market Cap but has £50m average cash (excluding customer deposits) then if you consider that SCS made around £15m PBT a year pre pandemic and allow for increased demand now with less competition in the market I think they can increase that PBT by at least 15%.

The forecasts are behind the curve so the next update will be crucial to give a good steer on things

[scooper72] 05/5/2021 13:19

Presumably someone needs their cash, happy with their return and as it is a small cap the selling has more of an impact than we would like.

[nickwild] 05/5/2021 12:12

why the sudden price drop?

[brucie5] 30/4/2021 13:13

Great confirmed BO now. And noone paying it any attention!

[finkie] 21/4/2021 21:54

Yes feels like the low valuation of this share is starting to catch the market 400p definitely possible on current fundemtals..

[chrisb1103] 21/4/2021 18:05

About time a decent move up here!Looking fwd to the 300s :)

[brucie5] 21/4/2021 17:42

That's a significant breakout, which not only takes us up to a five year high, but pays my Stockopedia sub for considerably longer.

If Paul Scott is right, we're not even in the right range yet.

:)

[joemillson] 21/4/2021 15:27

A bid maybe?

[farrugia] 21/4/2021 13:45

considering how high dfs climbed this need to go up more to catch up

[brucie5] 21/4/2021 12:42

Certainly looks like a breakout now.

[dangersimpson2] 20/4/2021 18:40

Breaking out to an all-time high on a day when most small caps are weak is a great sign.

[finkie] 20/4/2021 17:08

Nice tickle up today 260/265 prices around