Shoe Zone Share Discussion Threads

[chinahere] 11/2/2022 13:46

The market cap. at £1.50 per share is £75 million. There is nearly £20m cash in the business. At current share price to take this private the Smiths would have to raise 46% of £75m = £34.5m of which over half exists in the business. I reckon it is still a possibility even at a higher price.

[bountyhunter] 11/2/2022 13:35

I don't see that much competition on the high street at the same price level as ShoeZone. ShoeZone could gain from a household price squeeze in terms of more people buying cheaper shoes due to lower net incomes and higher prices generally. If ShoeZone put up their prices by say 5-10% they would still be considerably cheaper than Clarks.

[bountyhunter] 11/2/2022 13:27

Also see my second thought above. The Smiths already own 54% of the company. See my previous post 1312. May not happen but certainly not out of the question, again imho.

[bountyhunter] 11/2/2022 13:09

Under promise and over deliver assuming Covid remains 'under control' which cannot be guaranteed so factor in that risk wrt forecasts so far as is possible? No debt should help.
The other possibility is that the Smiths may be thinking of taking the company private in which case it would make sense to manage expectations. Zeus who they appointed not all that long ago have a track record of doing just that. Just a thought and imho.

[riverman77] 11/2/2022 09:50

Hopefully someone with more knowledge of SHOE can help me here. Does anyone know why brokers are forecasting a drop in EPS over next couple of years to around 10-11p? They achieved 14p this year and pre pandemic I believe they were doing 18-19p. I understand there were some one offs this year which boosted things a bit, and things like resumption of business rates may also be a factor.Nevertheless, SHOE seems to be a stronger business than it was a couple of years ago so would have expected it to at least get back to prepare Covid levels, if not higher.

[jw330] 11/2/2022 07:11

Boohoo is not a bad shout but I personally think asos is the better one out of all the battered online retailers to have a turnaround. Their website is much more pleasant to navigate and don't give off that cheap tacky feeling.

I feel like everything is on discount in boohoo and this will hurt their brand in the long run...But that's only imho.

Also asos is like a hosting platform for hundreds of brands so technically they have a wider moat and margin of safety so if one brand dies off it doesn't result in a massive reduction in traffic where as boohoo is at risk of this even though they do own nastygal and a few others.

[simmsc] 10/2/2022 22:49

In other words ... Buy when thunderstorm hits and sell when the sun is shining. Takes a lot of discipline and conviction to do that. Not for the faint hearted but it is how the big money is made. Right chaps, on that note, when do i double (or triple) up on my boohoo position that has been going horribly wrong? (Mistake of buying when the flippin sun was shining).

[jw330] 10/2/2022 15:16

nothing beats a bit of independent thought. Following recommendations often lead to herd mentality

[chinahere] 10/2/2022 09:07

You have to ask - why didn't it do that when they were 60p?

You pay a high price for certainty.

[fegger] 10/2/2022 08:54

On Stockopedia all the ratings are now high wth an overall Rank of 99 where 100 is the best you can get. Positive indicator and has improved a lot from a Stock Rank of 65 at beginning January. Also on ichmoku score it gets a strong bull indicator in January again being a very positive sign.

[bountyhunter] 09/2/2022 18:21

We could be about to consolidate around the 150-160p level for a while before continuing upwards - looking back at the £1 and 50p levels on the chart.
...or after today's news of all Covid restrictions being dropped a month early later this month we may just continue onwards and upwards?

[bountyhunter] 09/2/2022 12:38

CARD following suit today.

[mongrels3] 08/2/2022 11:56

Probably because of this:

'Footwear, furniture and jewellery saw strong sales growth in stores whilst spending on food and drink, toys and computing all fell during January'

From the KPMG retail sales monitor released this am

[simmsc] 08/2/2022 09:18

Nice spike up here today ?

[simmsc] 01/2/2022 21:17

Adding higher priced shoes to the range = incremental growth. Creates additional sales that shoezone would otherwise not have captured. I don't see how adding higher priced shoes would be very damaging (as long as the existing lower priced shoe range was not reduced).

[bountyhunter] 01/2/2022 20:07

Yes dividends set to resume, no debt as all outstanding debt has been paid off leaving a cash and equivalent balance of GBP19.0m at period end (2 October 2021) at which time there was even a significantly increased surplus of £5.9m in the ShoeZone pension scheme. Of course the Smiths are highly incentivised owning such a large proportion of the company between them (the Smiths upped their holding on 21 May 2021 to 54%) which is quite unusual and another plus here.

[chinahere] 01/2/2022 19:23

They probably have circa £20 million cash and are on a PE of 7 (assuming you believe they will get back to pre-covid trading - and why not?).

A quarter of a share purchase today is already in cash and there is also the potential for yearly 14% returns. They have historically made dividends close to earnings once they had a cash buffer which I guess they now have - I like them.

[bountyhunter] 01/2/2022 19:10

The best of both worlds then without having to pay through the nose for branded products with nothing else available as with many of the pricier shops such as Clarks, etc. Even with the branded products ShoeZone are likely to be cheaper in my experience.

[eezymunny] 01/2/2022 18:42

Err Shoezone have diversified away from a low cost shoe model



"As we refit existing stores to our new formats, the branded mix will continue to form a higher proportion of our overall sales". Just as budgets are getting horribly squeezed...

I wonder if you lot are even capable of seeing downside as well as upside.

The uneducati are everywhere M´lud.

[thecroots] 01/2/2022 18:03

Shoezone will do more than just fine in the long term - but there is a lot of headwinds in the short term. The lack of guidance, or even current trading figures in the recent announcement says it all.

It's not all rosy as people think in retail.

Like I said though, Shoezone will do more than fine in the long term.

I believe there is one more institution adding at the minute which is why there is support in the current share price

[bountyhunter] 01/2/2022 17:19

Exactly, some things you can't do without and shoes are one of them. If push comes to shove then many of those Clarks and department store shoppers will head to ShoeZone to save a few quid on their next pair of shoes and especially for their kids' shoes.

[kemche] 01/2/2022 13:46

And we are renowned for our cheap shoes. Plays straight into our core strength.

[zangdook] 01/2/2022 13:44

If people have less disposable income they're more likely to buy cheap shoes than no shoes.

[kemche] 01/2/2022 13:43

As mortgage rates, utility bills, NI contributions, rents, food bills rise then people's thoughts will naturally turn to buying shoes.