Retail Stocks

[Waltzing]

1 percent inflation ? no cant be ....

https://www.interest.co.nz/economy/130012/economists-warn-there-rising-risk-deflation-if-reserve-bank-doesn%E2%80%99t-cut-interest


deflation??

[Waltzing]

100 basis point before santa....

notice AUS has none....

which means AUS retail stocks wont BOOM again till 2026?


https://www.interest.co.nz/economy/130026/westpac-economists-have-changed-their-forecast-and-now-pick-reserve-bank-cut

[winner (n)]

Posted this other channel

While looking MHJ yesterday I asked myself why do are the likes of Michael Hill and Kathmandu serial under performers while Briscoes and Hallenstein Glassons keep performing well even in tough times

Conclusion was management ability ..... the ability/inability to manage through the retail cycles and the ability/inability to execute on strategic plans.

Oops where Warehouse you may ask .....I wasn't going to include them with Michael Hill and Kathmandu but they do deserve to be in that group.

One thing in common with Michael Hill, Kathmandu and Warehouse is the screeds of glossy slides over the years outlining why they are wonderful and the great strategies as to where they taking the business. Nothing ever seems to come of them ....ie management inability to execute strategic intention. Then again some might say they think far too much when just doing would be better.

Briscoes and Hallensteins on the other hand don't do such raves. No doubt they have a good strategies and they just get on and execute them while keeping the business in good shape even in tough times.

Are the under performers going to change? I doubt it and it will show in their results

[Basil]

Great post.  Turners fits in there with retail, although a finance company as well.  They do excellent presentations about their future strategic plans and then just get on with the job and do exactly what they say they will do.  Just one record profit after another, year after year no matter what the headwinds and challenges are.   I have the upmost respect for the caliber of the management team there as well.

Why would you bother owning the Warehouse, Michael Hill or Kathmandu when you have the likes of Turners, Hollenstein Glasson and / or Briscoes to invest your hard-earned capital into ?

[Shareguy]

Posted this other channel

While looking MHJ yesterday I asked myself why do are the likes of Michael Hill and Kathmandu serial under performers while Briscoes and Hallenstein Glassons keep performing well even in tough times

Posted this other channel

While looking MHJ yesterday I asked myself why do are the likes of Michael Hill and Kathmandu serial under performers while Briscoes and Hallenstein Glassons keep performing well even in tough times

Conclusion was management ability ..... the ability/inability to manage through the retail cycles and the ability/inability to execute on strategic plans.

Oops where Warehouse you may ask .....I wasn't going to include them with Michael Hill and Kathmandu but they do deserve to be in that group.

One thing in common with Michael Hill, Kathmandu and Warehouse is the screeds of glossy slides over the years outlining why they are wonderful and the great strategies as to where they taking the business. Nothing ever seems to come of them ....ie management inability to execute strategic intention. Then again some might say they think far too much when just doing would be better.

Briscoes and Hallensteins on the other hand don't do such raves. No doubt they have a good strategies and they just get on and execute them while keeping the business in good shape even in tough times.

Are the under performers going to change? I doubt it and it will show in their results

Oops where Warehouse you may ask .....I wasn't going to include them with Michael Hill and Kathmandu but they do deserve to be in that group.

One thing in common with Michael Hill, Kathmandu and Warehouse is the screeds of glossy slides over the years outlining why they are wonderful and the great strategies as to where they taking the business. Nothing ever seems to come of them ....ie management inability to execute strategic intention. Then again some might say they think far too much when just doing would be better.

Briscoes and Hallensteins on the other hand don't do such raves. No doubt they have a good strategies and they just get on and execute them while keeping the business in good shape even in tough times.

Are the under performers going to change? I doubt it and it will show in their results

I think you are bang on with your conclusion winner

"Conclusion was management ability ..... the ability/inability to manage through the retail cycles and the ability/inability to execute on strategic plans".

Also a lot hinges on having the right buyer. A person who understands the market, and can procure at the right price a product that the market likes. Finding a person who really understands the market is the challenge.

Pumpkin Patch failed after being a market darling I believe when they lost their design team manager. The designs that came in were not fashionable and the customers deserted in droves including our family at the time. Hallensteins I would say have great buyers and designers who understand the trends and what people are going to want each year. If I was the boss I would be looking after these people.

As far as Briscoes go, they are good in bringing in stuff that people want and as Rod Duke has said they get very good buying terms as they buy in bulk. But again it's all about the right product at the right time. There buying team have done a very good job.

I have recently taken a position in KMD. Based on the share price to what it could be worth if they get it right. At the end of the day it's just a punt and not a big position. New ceo just announced, good insider buying plus the possibility of M&A is how I see it.

On saying that I met a person yesterday who said they have done deals with Macpak and just recently sold product to Torpedo 7. I asked about KMD and she told me the buyers are too difficult to deal with.

Are the underperformers going to change you ask? Only time will tell but yes the best can fall and the weak can rise.

[winner (n)]

Great post.  Turners fits in there with retail, although a finance company as well.  They do excellent presentations about their future strategic plans and then just get on with the job and do exactly what they say they will do.  Just one record profit after another, year after year no matter what the headwinds and challenges are.   I have the upmost respect for the caliber of the management team there as well.

Why would you bother owning the Warehouse, Michael Hill or Kathmandu when you have the likes of Turners, Hollenstein Glasson and / or Briscoes to invest your hard-earned capital into ?

As shareguy say those three are just punts (not really investing)  ....... cheap as ....half price etc etc ....and they might just come right one day ...or be taken over

[Waltzing]

WHS, MHJ, KMD are trades really where as TRA is more likely a longer term bet...

scrap metal merchants with a bit of class...

RBNZ 25 this time? US 10 YR just spiked over 4...

there is still upside pressure to oil ...

but with china going full on electric even though they explode ...

any bets on 50?

[Basil]

We need a 50 bps cut.  The economy has been in a per capita recession for over 2 years and the current interest rate setting is miles above neutral.  There's a growing level of calls for 50 bps.  Many in business are saying what we've been through recently has been worse than the GFC or Covid.
https://www.interest.co.nz/economy/129937/david-hargreaves-previews-forthcoming-official-cash-rate-review-which-all-discussion
Companies in the retail sector that have performed well through the depths of the recession, (namely HLG and TRA), should really shine in the years ahead when the economy bounces back.

[KW]

Posted this other channel

While looking MHJ yesterday I asked myself why do are the likes of Michael Hill and Kathmandu serial under performers while Briscoes and Hallenstein Glassons keep performing well even in tough times

Conclusion was management ability ..... the ability/inability to manage through the retail cycles and the ability/inability to execute on strategic plans.

Oops where Warehouse you may ask .....I wasn't going to include them with Michael Hill and Kathmandu but they do deserve to be in that group.

One thing in common with Michael Hill, Kathmandu and Warehouse is the screeds of glossy slides over the years outlining why they are wonderful and the great strategies as to where they taking the business. Nothing ever seems to come of them ....ie management inability to execute strategic intention. Then again some might say they think far too much when just doing would be better.

Briscoes and Hallensteins on the other hand don't do such raves. No doubt they have a good strategies and they just get on and execute them while keeping the business in good shape even in tough times.

Are the under performers going to change? I doubt it and it will show in their results

Well Michael Hill is a bit of a no brainer - "its NZ, stupid".   
"Group revenue  was  up 4.2%  for  the  year  on  a  52-week  basis,  with  Australia  +10.3%, New  Zealand  -11.8%"

Being forced to close stores, provide additional security, and deal with the constant ram raids and armed robberies all costs money as well, something a clothing store doesnt have to deal with.


 

[KW]

Companies in the retail sector that have performed well through the depths of the recession, (namely HLG and TRA), should really shine in the years ahead when the economy bounces back.

Not necessarily.  If your target market is (a) young people who dont have mortgages or (b) recent immigrants who dont have cars, then any reduction in interest rates is not going to increase demand much. In the meantime, increases in unemployment will affect both more acutely.

Thats the reason why HLG has outperformed the likes of KMD and MHJ - different target market unaffected by recession (and taking advantage of recent wage rises due to inflation)

[Basil]

The target market for Turners is all New Zealanders.  Lower rate mortgages will lead to more people thinking they can update their vehicle.  Additionally, cuts in the OCR feed directly through to increased NIM as lower funding costs for existing higher fixed interest rate loans they've issued.  Glassons Au consistently gaining market share because they're perceived as cool affordable fashion.
Notice the nice uptrend on both stocks, very attractive looking TA.  Some person told me it's a good idea to own stocks in an uptrend   

[BlackPeter]

Well Michael Hill is a bit of a no brainer - "its NZ, stupid".   
"Group revenue  was  up 4.2%  for  the  year  on  a  52-week  basis,  with  Australia  +10.3%, New  Zealand  -11.8%"

Being forced to close stores, provide additional security, and deal with the constant ram raids and armed invasions all costs money as well, something a clothing store doesnt have to deal with.


 

Agree - with MHI its a no brainer. No brain in management, no brain in sales staff, no brain training their sales staff and no brain setting up their sales system. My wife and I tried them last year as customers, and we are certainly not going to repeat this mistake.

Went there for a replacement of our wedding bands (they tend to wear down every couple of decades ... this is why we need new gold miners ; They couldn't sell us the bands they advertised (wrong sizes, and they couldn't order the right sizes) - and when we found some others we liked (correct sizes) their system told them they can't sell them to us, given that according to their system they haven't been in the shop.

Sales lady worked fifteen minutes to convince their system to sell us the bands ... and managed finally with the help of some colleague to trick their system. She gave us the bands and ordered the bands she gave us, which allowed her to issue a bill / receipt for the order, so that she could take the money. During this time we had to stand at the check out. No seat, no coffee (the bands haven't been that cheap), no apology for their excruciating incompetence.

Pathetic. Couple of days later MHI send me an email and asked for feedback. I gave them a piece of my mind. They never bothered to come back and apologize either. Probably glad they are now making less revenue in NZ - less revenue, less work, less unhappy customers. Genius. 

Just wondering why they are doing better in Ossie - either they have a different system and staff training over there, or the Ossies have just less brain then the Kiwis (well, this is what Maldoon said anyway, didn't he?).

Anyway - forget them ... both Warehouse as well as KMD might not be good, but they are leagues better than MHI.

[winner (n)]

Card Spend data out for September.

Still paints a gloomy picture

Here's the trend from pre-covid times for Durables and Apparel (Discretionary)

The post lock down boost all but gone. durables are now below trend and Apparel back to trend but about the same as pre-covid

Interesting

You cannot view this attachment.

[BlackPeter]

Card Spend data out for September.

Still paints a gloomy picture

Here's the trend from pre-covid times for Durables and Apparel (Discretionary)

The post lock down boost all but gone. durables are now below trend and Apparel back to trend but about the same as pre-covid

Interesting

You cannot view this attachment.

Not a surprise in a cost of lining crisis - and I guess the tickets to Barcelona are not cheap either.

Good thing is - the trend went so far always back to normal plus some overshooting (which makes sense, if you think about it - people can only that long stop replacing their durables, and then they have more to replace.

So, maybe when everybody is back from the big party in Spain, then people remember that the Champaign in Spain tasted better when cold and they might even replace the broken fridge they couldn't fix to pay for the tickets to Spain in the first place.

Time to invest into some durables retailers?

[Waltzing]

could be a short party at this rate...

but remember the math and science behind the sailing was mostly UK home grown by the N man and Others like Hook...

certainly the english appear to have a problem and maybe time for them to change the crew...

maybe HLG could get a tee shirt out if they keep the mug ...

where will they hold it next time...any thoughts?