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I'd like to see what OzBargainers think of the current situation at Dicksmith with stocks sitting at $0.365. From what I gather, they'll probably get a new CEO and stocks will start climbing slowly back to $2.
Time to Buy DickSmith Stock?
onlyletters on 07/12/2015 - 23:33
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https://www.fool.com.au/2015/12/02/is-it-time-to-buy-bhp-bil…
How strong is your stomach, LOL. I'd wait at least until it starts climbing. People will interpret that as a recovery, start jumping back in. Tide that for a short time then get out before it crashes again - which it will at the slightest negative snippet in the news - because those that stayed on, will jump ship, as will the jittery ones that just came on board - which will drag it down twice as fast.
I've tried to learn the stock market, but what I continually see is, no matter how good the facts and figures - it means zip - because most people run on emotion, not maths.
I was actually thinking what you posted earlier today. But then I wondered if the likely xmas discounting mentioned in that article, could be the final top up for the CEO/s - right before the new-years suprise for staff - we're not reopening the doors guys!
Down over 80%. Quite an achievement that. They should abandon the TVs and laptops and sell dieting products with that record.
Also, back in August the guy said this:
'We continue to deliver sales growth and gain market share. Recent independent industry data… indicates that Dick Smith gained 60bp of share in FY15, with gains of a percentage point or more in our core categories. This is testimony to the success of our growth strategy and our successful approach to improving our brand and pricing perception in the marketplace'
Hm… I wonder what we see just a few months on - testifies of. What is driving sales atm is clearing product.
And… "We're going to drive top-line sales and cash conversion through this period and get momentum back in the business,"
Hm, ok - so where will REAL profit come from after they sell all that discounted stuff - or do they ony intend on staying afloat by continuing heavy discounting and claiming surviving on only hand-backs from the taxman!?
But, who knows either way. That's what makes it gambl… er, 'investing'.
Harvey Norman claims: "… some stockists were cutting supply and if a product was not in stock, Dick Smith was unlikely to be able to get it unless it was willing to pay cash."
So at least some suppliers are worried they won't get paid for the stock they provide!
Gerry going for the dagger!
Hard to see how they can recover to a quality business. Their strategy of driving foot traffic with Apple discounts didn't work, but when they stopped that things got worse. They pinned their growth on kiosks selling $20 cables and headphones, but it isn't as if these things are rare. What strategy could possibly work for them?
At this point I think they are more likely to go broke (and wipe out investors) than recover to $2.To the OP, that's what DSE wants you to think and then bail it out!
Something you have to realise is it was never worth $2. The $500 million value it floated as on the ASX was all made-up dreamy unicorns and rainbows. Whoever invested in them just didn't know any better. This is what Woolworths and Dick Smith were saying too.
Its actual value was closer to $100 million, which is 1/5th the price. So, 1/5th of $2 is $0.40. That's about what it was always worth.Guess what — that's what it is worth right now, on the ASX. $0.40 minus a few cents for the uncertainty of their firesales.
From what I understand they have more bad news to share before this is all over.. I would steer well clear.
So you think they can do another Anchorage stunt? Or do you think they will increase their profits and market share?
It's hard to take your post seriously given your Gravatar.
If you believe the current price to earnings ratio of 2.4 then DSH shares seem like a bargain.