Briscoe Group BGP

[winner (n)]

Jarden lift target price to $5.00

Forbar cut their target to $4.50 ...main concern spabout higher expense base going forward

Jarden say 'high quality retailer' but note 'quality but expensive ' and maybe rewards elsewhere in sector

Current share price $5.50

My target is $4.05

[winner (n)]

Briscoes share price into the 530's

Heading sub $5 I reckon

Rod Magic gone?

[Cod]

Weekly chart BGP

Time cycled price line at $4.37 (early Jan 26) which just happens to be midway between ATH & ATL AVWAP lines. Anchored volume profile support at $4.45 & $4.75 having already blown through major support at $6.12. Velocity breaching 0 about to go negative, Double trix large amplitude cross at 72.00 coming.
You cannot view this attachment.

[Basil]

EPS will struggle to be 30 cps this year, probably 27-28 cps. The starting point for consideration on what's a fair price is to put a no growth PE of 8.5 on that.

Even if it got down to that sort of level my concern is eps has been declining at quite some pace which suggests to me the strength of their business model is not what it once was. I think that's mainly a function of increasing competition at better price points and I think Rod's best days in retail are behind him. 

[lorraina]

Other than HLG and TRA all retail is struggling. Glassons Aussie is driving HLG.
I doubt whether BGP,KMD,MHJ,WHS and others can put the fizz back in the bottle.
More and more empty shops in the ChCh Malls I visit.
Worst thing you can have as a retailer is an empty shop next door.
That said BGP have always been on top of their stock holding.

[winner (n)]

Weekly chart BGP

Time cycled price line at $4.37 (early Jan 26) which just happens to be midway between ATH & ATL AVWAP lines. Anchored volume profile support at $4.45 & $4.75 having already blown through major support at $6.12. Velocity breaching 0 about to go negative, Double trix large amplitude cross at 72.00 coming.
You cannot view this attachment.

Amazing what speculation Re inclusion in NZX50 did and then disappointment when it didn't and then when it did happen wow

[winner (n)]

BGR share price doing its best not to go below 520

[Cod]

BGR share price doing its best not to go below 520

AVWAP ATH support at 5.19 so your observation makes absolute sense. 

[Basil]

Great short-long play would be to short BGP at 21 times a no growth retailer and long HLG at 12 times earnings with earnings growing at a CAGR of 9%.  Salt who have a short long fund should be all over that sort of play in my opinion.  Briscoes makes no sense to me whatsoever at this level or anywhere close to it.
Interesting that Tower and Turners are their two largest long positions as at 31 August.  https://www.saltfunds.co.nz/_files/ugd/9b51d8_fddcb1d0fa72445f8b3b1e10a2e235b1.pdf

[winner (n)]

Jeez close at $4.93

Light volume but trend definitely down.

Heading to my $4.05 target?

[LaserEyeKiwi]

Great short-long play would be to short BGP at 21 times a no growth retailer and long HLG at 12 times earnings with earnings growing at a CAGR of 9%.  Salt who have a short long fund should be all over that sort of play in my opinion.  Briscoes makes no sense to me whatsoever at this level or anywhere close to it.
Interesting that Tower and Turners are their two largest long positions as at 31 August.  https://www.saltfunds.co.nz/_files/ugd/9b51d8_fddcb1d0fa72445f8b3b1e10a2e235b1.pdf

Was more interested in their long thesis on HGH:

"What has changed is that HGH has cleaned house. They are now focused on their (average) car lending business, their strong stock finance business and their incredibly attractive reverse mortgage business where they are the largest provider in NZ/Australia. They are pushing on an open door in a market which has many years of strong growth ahead and which has very strong returns. Analysts are under-estimating just how strong those returns will be."

[Fiordland Moose]

trading on a cheeky 20.4x FY26 earnings 
https://www.nzx.com/announcements/462209

[winner (n)]

Record sales at Briscoes Group

Looking good .....unlike some other retailers they make a decent profit

Well done Rod

https://announcements.nzx.com/attachment/461514.pdfI'm

[winner (n)]

F26 NPAT going to be about $60m .... down on F25

Thats about teh same level of profitability they were generating in FY17 through FY19

FY18 sales were $605m with NPAT of $61m ..... profit margin of 10.1%

Now sales are just shy of $800m and NPAT around $60m ,,,, profit margin 7.5%

So selling heaps more these days for about the same profit

No wonder Rod talks a lot about margins but as I've said before one needs to wonder if the sales model is Peak Rod and this is as good as its ever going to be.

[Basil]

Even average EPS forecasts for FY 27 show no growth for the last decade.

No growth companies get a no growth PE of 8.5 in my book so fair value at 8.5 times 27 cents a long way south of the current share price and yet average analysts price target is $4.87 19 times earnings.

This is a great example of historical analyst bias I was recently talking about on the TRA thread.They look at the historical metrics BGP have traded on, tweak their DCF valuation model for latest information and come up with a biased viewpoint based on historical metrics not objective lack of any EPS growth over time.

How can a company in the same retail space that hasn't grown EPS in the last decade be worth higher metrics than TRA that's exhibited strong growth or the forward metrics of HLG at only 12 with more than 7% EPS CAGR ?

This sort of historical bias leads to very poor analyst recommendations  Another good example of a no growth company wrongly priced by analysts was Spark when not that long ago consensus price target was $4. Look how that worked out.

We've seen "peak Rod" and his best days are behind him.