Pinned straw:
Was there any mention where the 3-4 test stores in China are located or does anyone know where there are? Tried searching but can't seem find the store location for China. Travelling to Shanghai next month, if there’s a store in Shanghai I will do a shuttlebutt. Currently have no position in LOV previously held sold in 30 mark but with the price decline interest building a position possible soon if it retreats further.
Going by figures in Stock Doctor I get an average p/e over the last few years of about 59. Currently
it's about 35 (Stock Doctor again) with a forward p/e of 24. Factoring that we're also in a bull market (where average p/e's
get more inflated than usual) I'd forecast LOV's direction of travel more likely to tend in an upwards direction
in the near future.
Top exec's are also well aligned with shareholders:
Thanks for being the boots on the ground and reporting back @Slew. Really helpful notes.
It is disappointing they won't consider hybrid meetings. Even if remote attendees aren't put on an equal footing for asking questions with those in the room, it is a low cost way to provide more of the shareholder base direct exposure to hearing from management. Still, preaching to the choir here.
Overall, it sounds like everything is much as we've discussed here, but you've added some helpful colour.
150 new openings target must be a global goal. It's actually between my mid- and high-cases for FY25, although it sounds like FY25 will come in a lot lower based on FYTD. And from BB's remarks, while they'll target that number, failure to agree lease terms will create some drag, and then there will be the ongoing culling of underperofrming stores. I hope they maintain the capital discipline under the new CEO, although I expect BB will be all over that. Interesting to hear BB be so candid, as VH has, as far as I recall, always refused to put a number on the plans. Maybe it was a reaction to some of the analyst commentaries about the underwhelming update?
It was good to get the albeit brief clarification on China. At one level it is good to see they are taking their time to get the product-market fit right with the one test store and online focus. Moving to 3-4 test stores also makes sense as there are huge differences across the different parts of China. For example, from listening to The Economist Drum Tower - a long running regular podcast on China - it is fascinating to gain insights into the decisions young adults in China are making about careers, family, where to live - and this is creating very different markets across the different regions and types of cities. There are lots of other places for $LOV to focus the build out in the near term, so I hope they invest to get the right offer for China, even if it takes longer for the rollout.
The insights about RFID and upgraded systems is interesting. RFID integrated into inventory management, PoS and forecasting can create serious operational efficiencies. Particularly if you have a truly global business like $LOV, with lots of SKUs. It also frees up store staff to focus much more on customer experience. So it's good to see BB is working the business case on this one.
We've seen a few PT down-moves over recent days:
- Citi: from $31.16 (neutral) to $25.95 (sell) - that's the BIG step down.
- MacQ: from $35.10 (OP) to $34.10 (OP)
- UBS: from $33 to $29
Perhaps still a few more updateto come? So, still quite a divergence of views. (Interesting to note that the range of analyst views is a pretty close overlap with my views.)
For now, I will continue to wait this one out. As I said previosuly, $25 gives a nice margin of safety for a decent return however, in truth I could consider re-entering anywhere from $26. (I actually missed a brief opportunity at the open yesterday when it dipped to below $26 in the first 30 minutes!) Maybe we just need some more soft consumer macro numbers. ;-)
Was there any conversation about John Cheston?
I'm still interested to learn what his "serious misconduct" and "breach of contract" was. Was it attending an interview with BB on Premier's time? Any scuttlebut from conversations in the room? I haven't seen anything reported anywhere.
Disc: Not Held. On Watchlist
Great summary thanks.
Hate these dinosaurs that only want in person AGMs - like everyone lives near where it’s being held, or can cheaply get to where it is, let along the time constraints.
I hope the ASX forces them to have hybrid meetings soon. I think it shows a flagrant disrespect for shareholders.