numberbiter
27 Feb 2017
Re: Peel Hunt Whenever brokers (making decisions not based on hard financial facts, but mere speculation) force a share price significantly down, that is the time to buy, Presumably when they last met the company the wine was not as vintage as usual!
Hardboy
24 Feb 2017
Re: Peel Hunt Thanks NK,A few points: "it's hard to see a reason to hold the shares." - a well covered yield of over 5% maybe?One of the things I like about Halfords is different parts of the business do well when others do badly. "rising oil prices mean fewer miles driven and less depreciation, which is bad news for car maintenance as weFit momentum wanes" - If money gets tight for motorists some will switch to bikes, some will keep their cars longer, therefore spending more on replacement parts etc. and will try to fix things themselves rather than taking them to mainline dealers. All good for car maintenance and weFit. In that instance the broker is taking a factor and seeing its consequences as bad for Halfords. I take the same factor and see it as potentially good for the same areas of the business. There will probably be an element of both. There are some good points - imported goods which Halfords sell will be getting more expensive; and the challenge of getting the store presentation right is real' but the review sounds like someone who went to a store and could not find what he wanted or had to queue too long to pay (and maybe this was because the store was busy) so panned the company.
nk1999
23 Feb 2017
Peel Hunt Not disagreeing with Hardboy, but here it is from ADVFN:"Halfords slumped on Thursday as Peel Hunt downgraded its stance on the stock to 'sell' from 'hold' and cut the price target to 325p from was 350p."Fundamental headwinds are increasing and the new store format doesn't move the dial," the brokerage said.Peel said it doubts current consensus forecasts reflect that and it's hard to see a reason to hold the shares.It argued that rising oil prices mean fewer miles driven and less depreciation, which is bad news for car maintenance as weFit momentum wanes.Meanwhile, in bikes, the replacement cycle is lengthening and price inflation may have a big impact on volumes."We are nervous about the cycle market's growth in the next few years and Halfords' performance alongside that. Our view is that the replacement cycle for bikes is getting longer: there was a move towards premiumisation about ten years back and since then, whilst miles cycled have increased in general, the volume of bike sales has flattened off."Peel said "more inspiration" is required across the group, adding that it was underwhelmed by its visit to Derby's 'store of the future'."The cash attractions here are clear, but gross margins and cost ratios are under pressure as well as like-for-likes, so forecasts are falling."
Hardboy
23 Feb 2017
Brokers! Some broker downgrades it (for no apparent reason - why is it worth less today than yesterday?) and the share price tanks. Some brokers' analyses are very useful, but the majority I read seem to be written by someone with the economic knowledge of an 11 year old.
II Editor
20 Jan 2017
NEW ARTICLE: Share of the week: Halfords back in fast lane? "The market wasn't expecting much from car parts and bike retailer LSE:HFD:Halfords this week, but with third-quarter sales beating forecasts and a special dividend lining investors' pockets, its shares are one of the FTSE 350's top performers. ..."[link]
Bill1703
20 Jan 2017
Re: Bid on the way? "HFDs have got this 'orrible theory that debt isn't high enough; so more special payouts on the horizon?... Wonder if SMWH will go down the same path; up to now they seem to be happy with an ungeared balance sheet - I think it's called. Bill will put me right."Lupo et al - not surprised at the special for HFD; debt isn't high at all (I have 0.4x ND/EBITDA, most recent historic?) and they have shown consistently strong FCF generation. But I agree with the others on here who think the timing is curious. Maybe they've had a few of their big shareholders in their ear on this?No idea about SMWH, not one I have followed closely for a while... but on a cursory glance, wouldn't be surprised. Management have done a really good job there, although opinions do differ across the market on what makes an "efficient" balance sheet structure... FWIW, the consensus probably comes down to ND/EBITDA somewhere between 1x and 2x."... if you want to try to make yourself bid proof, you get the sp up as high as possible, which is the obvious bit... Back to the special, HFDs will have removed £20m or so from the value of the company; so that's £20m a buyer wouldn't be able to trouser for themselves."Absolutely right, ultimately - but getting the SP up is usually easier said than done! There could be some counter-bid thinking here... suddenly throwing a big special into the mix is a common enough tactic, though you usually see it as part of a 'live' defence situation, after a bid is public - maybe they're trying to be clever with a pre-emptive strike??And it's a bit of a popgun tactic - can't think of a bid-defence situation where it has actually worked? Perhaps, as one element of a wider array of measures... sure they remove £20m from the value, but it's also £20m less that a bidder would have to pay. As long it is a cash bid, investors are hardly likely to be that impressed by a bit of cash upfront versus 100% cash a few weeks down the line.
Lupo di mare
20 Jan 2017
Re: Bid on the way? Quite so, Hardboy. HFDs have got this 'orrible theory that debt isn't high enough; so more special payouts on the horizon?Wonder if SMWH will go down the same path; up to now they seem to be happy with an ungeared balance sheet - I think it's called. Bill will put me right.
Hardboy
20 Jan 2017
Re: Bid on the way? Good points Lupo, but I think if there were a predator they would be fairly minor considerations. (Also minor) I would think a share buy back may be a better tactic against a predator, specially if the shares were not cancelled. But as a shareholder I prefer the special dividend to a share buy back.As for the timing - it is strange - as you say it would normally be announced at finals or interims stage, or at the point of something specific like selling a subsidiary; but, like you, I'm not complaining. What interests me now is are the profit growth figures YTD as good as the sales growth? It's a long time to wait till 25th May. We may get a pre close trading update in mid April as they have done before, but even that is some way off too.
Hardboy
20 Jan 2017
Re: Bid on the way? Lupo, "Has that Japanese outfit still got a stake" According to Digital Look the main holders are all asset managers: -Artemis Investment Management, Jupiter Asset Management, Invesco Trimark, J O Hambro, Capital Management & Rathbone Investment Management I'm not sure I follow your logic that a special dividend should be related to a possible bid.Most of the directors have sizeable chunks of shares so maybe they just want to give themselves a little bonus.
Hydrogen Economy
20 Jan 2017
Re: What... NBI wouldn't take notice of any analysts but Deutsche take the biscuit. They were tipping AHT as a sell at below 800p last year with a PT of 660p, SP has since doubled, it was almost my biggest holding and best performer, so happy to have ignored them. Their business performance is no better. They should be struck off or have their passport revoked or something.
elliottsilverman
19 Jan 2017
Just as well I trusted my instincts and ignored Deutsche Bank ... as someone suggests below, DM's analysts must be lazy as several factors weren't properly taken into account with HFD - e.g. lumping them in with Next is asinine - people will buy a 3-pack of elasticated knickers online but they won't buy a 400-quid bike online - at least not en masse; yes HFD are "retail", but very different in the product and proposition. HFD have also wisely hedged their FX exposure but you would expect any serious, savvy, Brexit-aware company that buys in materials in a different currency to do so ... did Deutsche Bank assume they hadn't /wouldn't have thought of this/or DB didn't think of this themselves??? Says more about Deutsche Bank than HFD if you ask me. For another thing, anyone with 2 eyes (or even 1 eye) can see that cycling is on the increase as "a thing" (for several reasons incl. health, environment, time-management, commuting costs...] which speaks to the point about multiple businesses in one as someone mentioned below (though not 'heard here first' despite the claim) - yes, it is somewhat unusual in 2017 to have such an amalgam but it is very likely that the parts would be worth more as separate entities and so there is potential value to be unlocked there at some future point - but that's just another good reason to hold HFD - a second good business could easily be spun out and/or sold to a 3rd party... customer loyalty has significant potential value for a prospective online operator in car parts particularly . ... imo ... 
6-month target for HFD has to be in the region of 425p. [Disclosure: own between 100 and 1000 shares in HFD. 
]
Lupo di mare
19 Jan 2017
Bid on the way? What I'm struggling with is the special divi; whilst I'm very grateful, I do wonder why they're announcing it now. Do they believe that they're vulnerable to a chancy bid? It's certainly the sort of action that you'd expect under such circumstances. Has that Japanese outfit still got a stake? Must check. But it needn't be them, there's plenty of others looking at HFD's cashflow and the possibility of floating off the Autocentres.You heard it here first, folks.
numberbiter
19 Jan 2017
Re: What... Hardboy, the problem is that most analysts are lazy. They know that Halfords import a lot of goods and that because of the weakness of sterling, such imports will cost more. But they cannot be asked to do any research to find out what the company might do to mitigate the potential increase in cost. For example, in anticipation of Brexit causing sterling to collapse, they could have bought currency forward. Now, we don't know what the company did, but they have stated that they have plans that will fully mitigate the effect over time.Neither do analysts think a lot. When interest rates suddenly go up they issue a general note saying that they expect the share price of all their companies will fall, forgetting that companies with substantial cash balances will benefit.If you are involved in buying or selling shares you should carry out your own research and not rely on analysts.
Hardboy
19 Jan 2017
Re: What... "Deutsche downgrades Halfords to a sell with a target price of 310p. They give a variety of reasons for the downgrade, none of which are valid."I haven't read the post, but I suspect one of the reasons they gave is that Halfords costs will have increased, as many of the parts & equipment they sell are imported. Today's update showed encouraging increase in sales, but if costs are going up faster than sales, profits fall, so I imagine at least one of their reasons is still valid. But if margins are being seriously squeezed I doubt they would have announced the special dividend; so I think markets are correctly positive about them now.
malj1
19 Jan 2017
Re: What... Not quite. Be a CEO of a bank / fin serv co & be paid even more for knowing even less.
