# DDR - Dicker Data



## piggybank (12 February 2014)

The stock has shot up (35%) the past couple of days, mainly as the result of acquiring Express Data Holdings Pty Ltd (announced to the market yesterday for A$65.5m).


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## Knobby22 (12 February 2014)

It's extremely tightly held by 2 main shareholders.


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## skc (16 May 2014)

DDR up 20% today to $1.80 on the declaration of a $0.70 per share dividend.

Now just waiting for a correction notice admitting that it was a typo, and the dividend should in fact be 7c. Dividend last year was only 5c so anyone buying without doing some basic common sense testing is just asking for it. 

Should the ASX reverse all trades on this basis? Thankfully the volume is only very small.


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## Hoborg (16 May 2014)

skc said:


> DDR up 20% today to $1.80 on the declaration of a $0.70 per share dividend.
> 
> Now just waiting for a correction notice admitting that it was a typo, and the dividend should in fact be 7c. Dividend last year was only 5c so anyone buying without doing some basic common sense testing is just asking for it.
> 
> Should the ASX reverse all trades on this basis? Thankfully the volume is only very small.




The only other possibility I can think of is that Fiona Brown and David Dicker, who own over 90% of the company, plan on using the DRP to issue more shares to themselves... meaning they only have to pay 5% of the shares @ 70c in dividends at most.

Not quite sure what the benefit is though


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## craft (16 May 2014)

skc said:


> DDR up 20% today to $1.80 on the declaration of a $0.70 per share dividend.
> 
> Now just waiting for a correction notice admitting that it was a typo, and the dividend should in fact be 7c. Dividend last year was only 5c so anyone buying without doing some basic common sense testing is just asking for it.
> 
> Should the ASX reverse all trades on this basis? Thankfully the volume is only very small.




Suspect it is only* .*7c  last interim was only 1c and they appear to pay quarterly.

Interesting to see what does happen with the trades.


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## skc (16 May 2014)

craft said:


> Suspect it is only* .*7c  last interim was only 1c and they appear to pay quarterly.
> 
> Interesting to see what does happen with the trades.




Haha.. you are right. I made a mistake when I was pointing out someone else's mistake.

DDR is in the middle of a significant acquisition so a trimmed dividend makes sense.

I actually rang the company but everyone who could answer the question relating to the announcement were in a meeting...

P.S. And now we have DDR - NR.


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## Ves (16 May 2014)

craft said:


> Suspect it is only* .*7c  last interim was only 1c and they appear to pay quarterly.
> 
> Interesting to see what does happen with the trades.




127.7m shares on issue x $0.70 dividend = $89.39m cash required.   Unless they are adding to the already high leverage used in this company - then probably not.

But the sealer is that there are only around $7m of franking credits available??


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## Ves (16 May 2014)

craft said:


> Suspect it is only* .*7c  last interim was only 1c and they appear to pay quarterly.




Revised announcement - Confirmed 0.7c.


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## skc (16 May 2014)

craft said:


> Suspect it is only* .*7c  last interim was only 1c and they appear to pay quarterly.
> 
> Interesting to see what does happen with the trades.




Decision by ASX. All trades reversed...

I am neutral as to whether it is the right thing to do, but I know I'd be pretty pissed off if I was able to profit from the foolishness of others. 

Perhas they should have made the company be the principal to every reversed trade as a penalty for being sloppy on their announcements.


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## galumay (9 December 2014)

Added DDR to my SMSF, expecting some very positive synergies to start showing up in the balance sheet as a result of the bedding down of the Express Online acquisition.


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## Klogg (9 December 2014)

galumay said:


> Added DDR to my SMSF, expecting some very positive synergies to start showing up in the balance sheet as a result of the bedding down of the Express Online acquisition.




To be honest, I'm surprised DiData let Express go so cheaply. I know it was out of the 'scope' of their strategy, so to speak, but Express is actually larger than Dicker (by Revenues) and I can't imagine margins being much thinner...


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## galumay (26 January 2016)

Added some more DDR to my SMSF this week, at $1.43 they are great value, all the indications are that the acquisition of Express Online has been very successful and I think they will do well when the market turns and results filter out.


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## galumay (28 August 2017)

Another solid half year for DDR, good growth in revenue and profit. One of the better perfomers in my SMSF.


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## peter2 (30 May 2018)

It's time for an update on DDR. I've mention this stock in the short term trading thread but DDR is not suitable for this as price remains in a range. Price has been going sideways for most of 2018. 
I'm mentioning it now as there are indications (portents) that price may soon get above 3.00. 
For the chartists; rising higher lows, rising OBV and TMF


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## galumay (30 May 2018)

A great business from the fundy point of view @peter2, very tightly held by management, about 70% from memory. Lots of skin in the game! They have steadily grown revenue, earnings and dividends over the years. I wish I could find more businesses as good! I got in before they took over Express Online and it is close to a double bagger for me. DDR also pay a dividend quarterly which is a little unusual.


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## galumay (15 May 2019)

A storming day for DDR on no news at all, up nearly 6%, broke through $5 and now a triple bagger for me. (plus $10k's of dividends over the years.) My biggest position in the SMSF now.


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## just_jay (17 July 2019)

Break of resistance today with increased vol in the last 2 days. 

Interim report expected 26 Aug.


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## Klogg (17 July 2019)

galumay said:


> A storming day for DDR on no news at all, up nearly 6%, broke through $5 and now a triple bagger for me. (plus $10k's of dividends over the years.) My biggest position in the SMSF now.




Yeah, it's done very well. Average purchase price of $1.70 here - bought a bit back when they took over Express Data and the stock tanked on a bad HY.

If only I bought more than I did...


And an interesting bit of info: if you bought $10k worth in Jan 2011, here's the return:





52% CAGR is just insane.


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## galumay (17 July 2019)

Yes, Klogg. I must have bought just a bit earlier, my average price is $1.63, its my biggest postion by far. It was always a very high conviction business for me.


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## peter2 (24 July 2019)

@Klogg or @galumay  After staying in a tight range for all of 2018 price has bolted higher from $3 to $7. Was this price explosion instigated by any corporate development in late 2018?


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## barney (24 July 2019)

Klogg said:


> Average purchase price of $1.70





galumay said:


> Yes, Klogg. I must have bought just a bit earlier, my average price is $1.63




Just bounced across this thread courtesy of @peter2 post ….. Well done gentlemen … nice little earner


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## galumay (25 July 2019)

peter2 said:


> Was this price explosion instigated by any corporate development in late 2018?




I dont think so. I have learnt generally not to try to understand why an irrational market prices things the way it does on a short term basis! 

If I was inclined to think about an explanation I suspect the business was 'hidden' due to its very high proportion of founder ownership, which precludes it appearing on the ASX indices. 

Once noticed/discovered the high yield, payed quarterly has lead a number of brokers and analysts to push DDR pretty hard to clients, so that may be a partial explanation.

There has also been some muted suggestions of takeover potential, not sure if thats adding some fuel to the fire.


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## Klogg (25 July 2019)

peter2 said:


> @Klogg or @galumay  After staying in a tight range for all of 2018 price has bolted higher from $3 to $7. Was this price explosion instigated by any corporate development in late 2018?




Much like @galumay, I don't actually know. But if I were a betting man, I would suggest something like this:

- The business has achieved greater efficiencies, increasing the very slim NPAT margin they currently take. I believe this will increase once they move into the new facility (a year or two away)
- At the same time, they've managed to increase revenues substantially
- In addition, they've increased working capital. Whenever they do this, there is usually a boost to revenues, as you're adding more vendors or products
- All of these compounded to a 20%+ first quarter, and 40%+ NPAT. Although the company didn't say as much, I suspect this will continue over the year. 

Only the 1st quarter result has really been announced. The rest I'm reading into, through a combination of understanding the accounts and directors buying at about $5 (over 20 times trailing earnings). Something substantial must be happening for directors to be buying at that multiple.

As I say though, this is a guess. I could be wrong.


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## peter2 (25 July 2019)

Thanks, I was unaware of any significant event also. I sold my last DDR holding in Sept18 (market dip) and unfortunately didn't re-buy Feb19.


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## Klogg (25 July 2019)

peter2 said:


> Thanks, I was unaware of any significant event also. I sold my last DDR holding in Sept18 (market dip) and unfortunately didn't re-buy Feb19.




Our approaches are quite different, but FWIW I offloaded a small portion of my holding today. 33 times trailing earnings (~ 3% yield) is quite expensive, even if they do achieve a 40%+ NPAT this year.

Surprisingly, my sell order for 10,000 units was filled almost immediately, even though there were no visible buy orders at the price when I put my order in. (I know very little about market depth and the working of exchanges)


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## leyy (25 July 2019)

Klogg said:


> Yeah, it's done very well. Average purchase price of $1.70 here - bought a bit back when they took over Express Data and the stock tanked on a bad HY.
> 
> If only I bought more than I did...
> 
> ...




Hi Klogg,

Well done and it must of been very tempting to sell the stock along the way.

I was interested in that little calculation you did, is that from a particular website or app?

Cheers
Leyy


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## Klogg (25 July 2019)

leyy said:


> Hi Klogg,
> 
> Well done and it must of been very tempting to sell the stock along the way.
> 
> ...



I used Sharesight. I believe there's a free tier.

In there, there's a button called "Share Checker" or similar. You enter the stock code and theoretical purchase date and it tells you the return until now.


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## galumay (26 July 2019)

Klogg said:


> but FWIW I offloaded a small portion of my holding today. 33 times trailing earnings (~ 3% yield) is quite expensive, even if they do achieve a 40%+ NPAT this year.




I also decided to lighten my postition. The disconnect between value and price had just got to the point where I was no longer comfortable holding such a huge position in my portfolio. 

I sold 15,000 to get my position size down to something less scary, still my biggest position but to sell more the tax implications get a bit scary. Like you I had no trouble moving them, i sold in 3 parcels just to be sure, but they were gobbled up very quickly. Averaged about $7.27.

Now I have to go and do some real work and try to find a new home for the capital!


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## Klogg (26 July 2019)

galumay said:


> Now I have to go and do some real work and try to find a new home for the capital!




That's the worst part of all!


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## galumay (28 August 2019)

DDR released their HY report today, (they run a calender year), given the strength of the result for the half I may come to regret offloading a significant part of my holding! Smashed their guidance and are about 25% ahead of guidance at this stage.

When you look at the growth in this business over the last 5 years you have to wonder why people are paying insane multiples of things like revenue & sales for so called growth businesses.


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## Klogg (29 August 2019)

galumay said:


> DDR released their HY report today, (they run a calender year), given the strength of the result for the half I may come to regret offloading a significant part of my holding! Smashed their guidance and are about 25% ahead of guidance at this stage.
> 
> When you look at the growth in this business over the last 5 years you have to wonder why people are paying insane multiples of things like revenue & sales for so called growth businesses.




I'm already regretting my sale. I broke the rule - "Buy right, hold tight". I look years in advance when buying things, but sell due to overvaluation on the current state. Cognitive dissonance at its finest.


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## tinhat (29 August 2019)

Klogg said:


> I'm already regretting my sale. I broke the rule - "Buy right, hold tight". I look years in advance when buying things, but sell due to overvaluation on the current state. Cognitive dissonance at its finest.




Don't beat yourself up. If in doubt, sell out. Nothing wrong with preserving profits. You can always buy back in but you might find better opportunities elsewhere in the mean time. The problem is the volatility in the share price. How likely is it to beat the July high anytime soon? Looking at the chart I suspect that may not happen for some time.


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## galumay (29 August 2019)

Klogg said:


> I'm already regretting my sale. I broke the rule - "Buy right, hold tight". I look years in advance when buying things, but sell due to overvaluation on the current state. Cognitive dissonance at its finest.




I generally do the same, but at some point when the price is so far ahead of any sane valuation, I think there is a case for taking some off the table. Also at some point postion size becomes an issue, while i dont normally do any rebalancing or allocation nonsense, my DDR had become such a large part of my total wealth that it was effecting my peace of mind.



tinhat said:


> Looking at the chart I suspect that may not happen for some time.




Probably talking to the wrong people there tinhat!! I dont believe the squiggly line of history informs or indicates anything about the future.


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## Klogg (29 August 2019)

galumay said:


> I generally do the same, but at some point when the price is so far ahead of any sane valuation, I think there is a case for taking some off the table. Also at some point postion size becomes an issue, while i dont normally do any rebalancing or allocation nonsense, my DDR had become such a large part of my total wealth that it was effecting my peace of mind.
> 
> 
> 
> Probably talking to the wrong people there tinhat!! I dont believe the squiggly line of history informs or indicates anything about the future.




DDR before selling was roughly 13% of the whole, so it was far off becoming a problem. With the remaining 75% stake I kept, it's now roughly about 9% (there's been some price movement in other holdings).

I was sleeping better when I held more of it. I understand the industry, management and company. Shame I now have to pay tax on what I sold, only to buy it again slightly cheaper (if I decide to buy it).

But thanks @tinhat and @galumay for the responses.


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## Klogg (29 August 2019)

tinhat said:


> Don't beat yourself up. If in doubt, sell out. Nothing wrong with preserving profits. You can always buy back in but you might find better opportunities elsewhere in the mean time. The problem is the volatility in the share price. How likely is it to beat the July high anytime soon? Looking at the chart I suspect that may not happen for some time.




I think it was craft who suggested that unrealised gains are like an interest free loan from the ATO. Let it compound at much as possible, rather than pay tax.

That continues to hold true.


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## galumay (29 August 2019)

Like me, you kept a significant amount, so thats a good thing!


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## craft (30 August 2019)

Klogg said:


> I'm already regretting my sale. I broke the rule - "Buy right, hold tight". I look years in advance when buying things, but sell due to overvaluation on the current state. Cognitive dissonance at its finest.



Hi @Klogg 

When I use the mantra, “buy right” it means buy good businesses at prices that make sense. 

“Hold tight” to me means hold through thick or thin so long as the business is trending in the right direction. The thick is sometimes the hardest to deal with, you know the earnings are elevated and you know the price multiple is high. Your run of the mill business contraction which is just a normal part of a healthy business could easily see the price down 50%.+ What do you do??? I coined the term hold tight for myself in relation to this point because I worked out that for me, holding was the best solution so long as the business fundamentals stayed intact. It’s not easy sitting through retracements, especially if you eventually work out at a lower price that things are heading south with the business, but then paying tax and buying back isn’t easy either, especially if you get whipsawed.

I had plenty of premature sales as I strengthen my holding discipline.  Sometimes switching into something else, another good business at a lower valuation is a potential solution – If you do this don’t just look at the sell in isolation but what you replaced it with as part of evaluating the total decision.

I will always remember seeing a Charlie Munger clip where he said if you can’t handle a 50% retracement you have no right being an equity investor. It sort of helps me when things move from thick to thin whilst I’m still on the ride.

Nice to communicate with you again.


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## Klogg (30 August 2019)

craft said:


> Hi @Klogg
> 
> When I use the mantra, “buy right” it means buy good businesses at prices that make sense.
> 
> ...




I've always taken that statement to mean buy quality (at the right price) and hold it. In this case, the price wasn't tanking, but rising. However, there's a margin improvement that seems permanent, so one could argue it has more to rise, or is of higher value than I initially thought.

My problem with swapping out a company for another, is you need to be trading for significantly more value to make up for the tax bill you're incurring. I do think I bought more value for the same dollar, but that's a tougher decision after tax.


On price falls - I have a large concentration (now at least 50%) in one holding at the moment. It has dropped approx. 50% from peak. That hurts. But if I view it from a cash flow basis, it does not. I think I know the Munger clip you're alluding to, where he states he and Warren have experienced 50% (or more) drawdowns 3 times (maybe more). Having that in mind does help.


Broadly speaking, it's quite amusing how things have panned out. Over the last 9 years, I went from trying to identify quality (and failed at that), moving to quantitatively cheap things, then back to my own version of quality - things with an identifiable competitive advantage. It takes a long time to embed that way of thinking... and I'm only part of the way there.

Great to have you back on the forums!


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## galumay (30 August 2019)

Good discussion Craft & Klogg, I really have nothing to add - being nowhere near in the league of you guys. One thing that helped with my decision to reduce my exposure to DDR was that I have finally taken a massive tax loss on my SGH holding, so that removed most of the tax issue!

I do know that the few times I have sold down my winners, when I go back and check I am worse off with where I moved the capital. (mind you, the time I didn't do it was SGH at nearly $8!!)

My big improvement as an investor has been the ability to overcome the desire for activity. For some reason my reaction to significant drawdowns has never been an issue, it must be something in my inate personality/psychology.

Anyway, having said I have nothing to add, i better shut up!


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## Dona Ferentes (5 July 2020)

An interesting discussion above which, with some hindsight looking at graphs, shows the run up finished (Aug) when the posts did ! Well done!!






.................Earnings ........................................Return on Equity  ........................

DDR seems to have come through these Covid times pretty well and has recently had cap raise and SPP at $6.70. Funds going to
• Partially fund Dicker Data’s new distribution centre
• Provide funds for further investment in Dicker Data’s DDFS product
• Provide balance sheet flexibility and broaden Dicker Data’s share register, increasing free-float to above 30% and potentially improving trading liquidity

In fact it is seeing a strong, short term demand tailwind related to Covid-19. The company said “it has seen strong Q120 performance with record monthly revenue achieved in March 2020.” The DDFS offering is aimed at creating long-term renewable contract-based revenues. Investment will finance instalment based products.

Some words around possible future performance can be found at
https://arichlife.com.au/dicker-data-ltd-asx-ddr-raises-capital-at-6-70-per-share/


> Looking out longer term, the company will be financing some of its own customers through Dicker Data Financial Solutions (DDFS), which is risky, and moving to a bigger distribution centre, which will reduce its strong operating leverage over its current physical assets, at least temporarily. On top of that, I think IT spend will reduce overall as Australia copes with recession. So over the next 2-3 years, I’m not overly bullish the business.
> But in the short term it is a beneficiary of the pandemic, with good management and a long term history of solid growth. It is also exposed primarily to Australia and NZ, both of have avoided [a covid-19 disaster]



But oh, the PE, that's pretty high. The aim seems to be to take advantage of current turmoil to enhance their position.  Don't achieve the growth and the downside becomes pretty apparent, and quickly.

_(don't hold)_


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## peter2 (5 July 2020)

One of the few companies who's share price has made new all time highs after the COVID selloff. For me, this indicates strong insto support. There was some selling at the new high and I'm interested to see if there's more selling when price closes above 8.00 level again.


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## Dona Ferentes (5 July 2020)

peter2 said:


> One of the few companies who's share price has made new all time highs after the COVID selloff. For me, this indicates strong insto support. There was some selling at the new high and I'm interested to see if there's more selling when price closes above 8.00 level again.



30% free float is going to accentuate moves. Tightly held.


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## Klogg (5 July 2020)

Dona Ferentes said:


> 30% free float is going to accentuate moves. Tightly held.




Have held this from 2013.

David Dicker is easily in the top 3 CEOs of the ASX.


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## galumay (5 July 2020)

As you know I have held for a similar time, I sold down another parcel recently at $8.40 to reduce the size of my position again, may well end up regretting it! I moved some capital into EMB at $10 so we will see how it turns out over the long term.


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## Klogg (5 July 2020)

galumay said:


> As you know I have held for a similar time, I sold down another parcel recently at $8.40 to reduce the size of my position again, may well end up regretting it! I moved some capital into EMB at $10 so we will see how it turns out over the long term.



Have a listen to this:
https://www.ausbiz.com.au/media/ceo-chat-dicker-data-gets-ready-to-go-global?videoId=2421

I do wish he'd use some equity (20-30% of txn value). But buying out an underperforming distie at 1% PBT margins and bringing them to 4% on basically all debt is a formula for crazy returns.
Worked with Express Data.


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## peter2 (21 August 2020)

DDR seems to be testing 8.00 again. This looks like an important level as it's been here before. 
I've posted my weekly and daily charts. The weekly chart shows that DDR has been going up faster than the general market (RSC-XNT, top pane). Volume (bottom pane) has subtlety risen while price remains in this range. The volume on the daily chart (bottom pane) is very interesting. All the recent large volume days are green (up days). We know the free float is small so it's hard for insto's to buy all they want quickly without raising their prices. I think some insto's have been nibbling at DDR. Can't wait until the current supply is gone.


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## Dona Ferentes (28 August 2020)

Dicker Data is eyeing growth from helping company's with their return to work strategies over the next six to 12 months as the IT distributor reported a healthy lift in half year profit.

Net profit after tax increased 23.6 per cent to $29.4 million as revenue increased 18.1 per cent to just over $1 billion amid a surge in the number of people working from home and demand for remote and virtual working solutions.

Profit margins of 9.6 per cent were higher than the 9.1 per cent recorded at the same time last year.

Dicker Data says the rollout of 5G connectivity over the coming 12-24 months is going to have a "revolutionary" effect with the industry


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## galumay (28 August 2020)

Market reaction was muted, I guess there was a lot of expectation baked into the current price. I haven't read the report in detail yet so I cant add much. I do doubt the spin about 5G, its the most overhyped thing I have seen in a long time.


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## Dona Ferentes (28 August 2020)

Dona Ferentes said:


> Dicker Data is eyeing growth from helping _*company's*_ with their return to work strategies over the next six to 12 months as the IT distributor reported a healthy lift in half year profit



and apologise for not correcting the work-experience morning shift for grammatical lapse


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## peter2 (21 September 2020)

DDR encounters more supply just above 8.00 again. It must run out soon or be withdrawn. Rising lows are bullish. 

If there's a market dip late Sept/Oct it may be the last chance to top up. Once the 8.00 supply is gone price may go straight to 10.00.


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## galumay (21 September 2020)

You may be right, Peter. I sold a parcel at $8.40 to reduce the position a bit, that looked smart for about 3 months! It certainly seems to have some enthusiastic buyers at the moment.


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## kenny (21 September 2020)

DDR has never struck me as a share to trade but rather to accumulate as long as they maintain their strategy both operationally and in terms of dividend payout. I'm glad I finally convinced my better half to collect some too.


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## peter2 (21 October 2020)

Another good market update by DDR.  There was a little late day selling. 






The next days presentation perked the buyers up again. Price is now just below the $10 level. 

It's was interesting to see that DDR is reducing the impact of their well established top 5 vendors. It was also interesting to see that they've expanded their warehouse capacity by 80%. The "just in time" supply chain has been significantly impaired by the COVID pandemic.


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## peter2 (15 July 2021)

peter2 said:


> If there's a market dip late Sept/Oct it may be the last chance to top up. Once the 8.00 supply is gone price may go straight to 10.00.




I was partly correct, price did get to 10 then traded sideways before rallying to high at 12.60. Since then price has drifted down in a choppy corrective move. When I say corrective it means messy. Price went down to 9.00 and then rallied strongly to 11.80. This rally looks like a 3 wave abc correction and the current swing could be wave b of a much larger abc correction. If this analysis works out then price should flop down to 8.00 fairly quickly. This would complete the large corrective pattern and then price should rally up to new all time highs although this will take some time. 

My question, if you followed all that, Is *DDR* in a larger term abc correction? Or is price headed higher to the recent ath (12.60)? 

The price chart is so sloppy because the daily traded volume is only ~200K/day. If I don't know what the chart indicates then it's probably a good idea to go to another company chart. Discussion only as I don't have a definitive outlook on this chart.


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## galumay (16 July 2021)

@peter2 I imagine the tight registry influences how DDR trades, still 80% held by the top 20 so only 20% free float and the Dickers still hold 66% between them.


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## galumay (30 July 2021)

Significant acquisition for $DDR, buying Exeed for $68m in an all cash deal. 4.5x EBITDA looks a pretty good deal.


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## peter2 (2 August 2021)

The market likes it and a few of us here at ASF like it also . 
*DDR* was a newly acquired position in the P2 combo portfolio.


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## wabullfrog (2 August 2021)

Shorters of DDR may be feeling some pain today. It's about 3% according to Shortman, I'd attach an image but ASF doesn't like it for some reason.


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## Dona Ferentes (2 August 2021)

a different style :



> Chairman and CEO, David Dicker, Dicker Data Limited said, _After many attempts, over more years than I can count, we have finally got a deal done to acquire Exeed. This transaction will put us a very strong number 2 in NZ, with a platform for number 1. The combined companies are highly synergistic. The deal done will be all cash.  A very satisfying outcome._


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## galumay (2 August 2021)

The Dickers still hold over 60% so I assume they have done their due diligence and the acquisition will prove successful. They have a pretty good record, Express Online was a pivotal one for them.


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## peter2 (31 August 2021)

David Dicker has sold 2.5M shares at 15.40 (great price) and now holds 58M (33.6% voting power of DDR)

It seems that his sale has spooked the market, as price has fallen significantly lower.


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## galumay (31 August 2021)

I wondered how many actually knew what had gone on? Maybe they just sold because they saw the price drop the day he unloaded his 2,5m shares? It has run multiples ahead of my estimate of fair valuation so I am not entirely surprised to see a reset, still very expensive in reality! 

I just keep holding, its a cash cow for me in relation to my initial cost price.


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## kenny (31 August 2021)

Can we find out who picked up the $42.2M shares David Dicker sold down? They'd be underwater a chunk right now. Clients of Barrenjoey Capital Partners perhaps?

I wonder how many were bought to close out squeezed short positions?


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## Smurf1976 (31 August 2021)

galumay said:


> I wondered how many actually knew what had gone on?



I didn't - I sold simply because the stop was hit.

Given the magnitude and speed of the drop, I probably wouldn't be the only one in that situation - out but no idea as to why other than that price fell.

I sold at a profit so not complaining, but still.....


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## peter2 (1 September 2021)

David Dickers explanation for his recent sale of DDR shares.


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## galumay (1 September 2021)

Its a bit arrogant really, assuming the drop in price was purely a response to his sale of shares. Even as a long term SH its obvious its very over priced, post the FY2021 results its hardly surprising some of the wind has been knocked out of the sails. Its still priced like a SaaS Stonk rather than a electronics distributer!


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## peter2 (2 September 2021)

No, I didn't catch the *DDR* falling knife but waited until it hit and struck support. I grabbed it as it was quivering. Spec position only of course. 
The Dicker statement made all the difference to the market sentiment.


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## kenny (8 October 2021)

It looks like "new" director Vlad MITNOVETSKI topped up another 5000 shares at $11.90 on the 5th October. It's nice to see him accumulating whenever there's a dip.


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## peter2 (26 October 2021)

Very satisfying day for holders. I feel for long term investors (LTI) as I wonder if they ever feel joy. They're sitting there, accumulating vast fortunes. They've sat through dips, falls and rallies. Volatility has dulled their emotions. Nothing surprises them. On the other hand are the short term traders. Who analyse and anguish over every price dip and rally. As one of the later, today was a joyful one as *DDR* rallied on the latest update. I bought the falling knife, added on the reversal setup and today's price spike delivers pure joy. 

I'm jumping on the bed, sofa, full of energy and the LTI, well, they're asking, should we open a bottle of wine with dinner tonight, dear?


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## Miner (26 October 2021)

peter2 said:


> Very satisfying day for holders. I feel for long term investors (LTI) as I wonder if they ever feel joy. They're sitting there, accumulating vast fortunes. They've sat through dips, falls and rallies. Volatility has dulled their emotions. Nothing surprises them. On the other hand are the short term traders. Who analyse and anguish over every price dip and rally. As one of the later, today was a joyful one as *DDR* rallied on the latest update. I bought the falling knife, added on the reversal setup and today's price spike delivers pure joy.
> 
> I'm jumping on the bed, sofa, full of energy and the LTI, well, they're asking, should we open a bottle of wine with dinner tonight, dear?



@peter2  - looks like this week you have earned enough to treat all of us with few bottles of Penfold- congratulations mate.


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## galumay (26 October 2021)

peter2 said:


> Very satisfying day for holders. I feel for long term investors (LTI) as I wonder if they ever feel joy. They're sitting there, accumulating vast fortunes. They've sat through dips, falls and rallies. Volatility has dulled their emotions. Nothing surprises them. On the other hand are the short term traders. Who analyse and anguish over every price dip and rally. As one of the later, today was a joyful one as *DDR* rallied on the latest update. I bought the falling knife, added on the reversal setup and today's price spike delivers pure joy.
> 
> I'm jumping on the bed, sofa, full of energy and the LTI, well, they're asking, should we open a bottle of wine with dinner tonight, dear?



As a LTI, i felt a twinge of joy today!


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## JohnDe (9 February 2022)

A great performer

$14.220​Today's Change Up $0.680 (5.02%)​
Some analysts have been say sell for the past few months.
​


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## galumay (9 February 2022)

The increase in dividend announced today was the reason for the jump I suspect, up over 8% now to $14.60. 
Divvy for 2021 ended up at 42c, up 27% from 33c last year.  Thats a yield of 25% on my entry at around $1.60. 
Buy & Hold doesnt work anymore, eh?!


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## Dona Ferentes (9 February 2022)

_We should all be on the hunt for fairly valued companies likely to deliver reasonable compound profit growth._

Kerr Neilson says rising bond yields means serious investors can prosper again as tech valuations crash back to earth and *free cash flow* yields return as a dominant driver of investment returns. [He] also urged retail investors to use the new economic cycle as a touchstone to refocus on pre-pandemic valuations and realistic returns.


> _“If you compound returns at 14 per cent a year for 20 years you get 13 times your initial stake,” _Mr Neilson said_. “I’m just trying to get people to love the idea that if you do what is sensible you will confound yourself at the outcome. If you’re a serious investor through time, and you keep moving from highly priced to less highly priced, you will accumulate incredible wealth.”_


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## JohnDe (21 February 2022)

Trading Halt



> Dicker Data makes $20m play for Hills SIT division​
> MATT BELL
> Dicker Data enters into a conditional business sale agreement to acquire the Security and Information Technology (SIT) distribution division of Hills Limited for circa $20m.
> The purchase price represents a premium to the net assets sold and the final amount is largely dependent upon inventory related balances at the completion date.
> ...






> Proposed divestment of Hills security and IT distribution business
> 
> • Proposed divestment of Hills security and information technology distribution business for an estimated $20 million cash consideration
> • Consideration represents a premium to net assets
> ...


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## divs4ever (21 February 2022)

i do hold HIL

 HIL another incredible shrinking company 

 hope DDR can make it work out 

 *** • Hills to focus on strong growth prospects in its health technology business and technical services operations  ***

 they haven't managed that in the last 11 years  , why should you believe them now


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## galumay (2 March 2022)

Full year 2021 results for DDR looked good on the headline profit, but the big drop in FCF tells the story of the challenges that have faced the business in the last 12 months. As always my main concern with DDR is the excessive debt they carry in order to maintain the very high divvies for Davey's race car project in NZ. Really cant complain, it just keeps growing revenue, profit and divvies, year after year. Its been one of my best positions for many years.


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## JohnDe (2 March 2022)

galumay said:


> Full year 2021 results for DDR looked good on the headline profit, but the big drop in FCF tells the story of the challenges that have faced the business in the last 12 months. As always my main concern with DDR is the excessive debt they carry in order to maintain the very high divvies for Davey's race car project in NZ. Really cant complain, it just keeps growing revenue, profit and divvies, year after year. Its been one of my best positions for many years.
> 
> View attachment 138424




Agreed. I've been advised to sell but as you mention, it keeps growing.


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## galumay (2 March 2022)

My question is always, if I sold something, how certain am I that I can deploy that capital somewhere else where it will produce better returns. Thats a tough ask with DDR, look at these numbers over 10 years,


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## JohnDe (24 March 2022)

> *Simple lessons in David Dicker’s 25-year overnight success*
> It took until the fast car enthusiast was 50 to realise what he needed to change to be a success in business – pay staff well, hire more women and stay out of the way. The results have been startling.
> 
> David Dicker was turning 50, going through a divorce, and had failed to sell his computer hardware and software company for about $10m a year or two before.
> ...


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## JohnDe (20 May 2022)

AGM Presentation



			https://cdn-api.markitdigital.com/apiman-gateway/CommSec/commsec-node-api/1.0/event/document/1410-02523481-7997NC319KG8ABKB9D832JAGMI/pdf?access_token=00071k8DkHsruEBhZUm1M0uqrYp6


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## peter2 (20 May 2022)

*DDR*: The $12 level appears to be a solid level of support. Price has traded at $12 three times and each time there's been evidence of demand (buyers). 







In the current bearish sentiment I'll wait for a reversal pattern with a close >$13 before considered a buy.


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## JohnDe (14 June 2022)

Topped up at todays low, finished in the green. All the directors have been buying.


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## peter2 (26 July 2022)

* H1 2022* results.  They looked quite good to me but the market had a different opinion selling them down immediately. 










I'll be waiting for a reversal setup to trade them again. Perhaps near the bottom of the large corrective channel that has formed.


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## Dona Ferentes (26 July 2022)

Dicker Data said its operating profit rose 11 per cent to $51 million in the six months ended June 30 as its sales increased 36 per cent to $1.46 billion.

_... so, less profit per unit?_



> Demand remains strong, although supply chain challenges, rising freight costs and acquisition costs affected profit margins over the half year.


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## galumay (26 July 2022)

Yep, I think the drop was instros getting out, someone pointed out a lot of their models are weighted to gross margins which obviously contracted a little. Still exceptional for a distro business and certainly not something that made me reconsider continuing to hold.


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## JohnDe (7 September 2022)

Is it me or has there been a few SPPs happening lately?

Dicker Data Limited (Dicker Data) (ASXDR) confirms that the offer booklet (SPP Offer Booklet) in relation to the Company’s recently announced Share Purchase Plan (SPP) was dispatched to eligible shareholders earlier today. As such, the SPP is now open.​​*The key dates for the SPP are set out below*​


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## galumay (7 September 2022)

I will skip the SPP, too expensive, share price has nearly dropped to the same level. Annoying about the dilution, would prefer they suspended the divvy to get the debt under control and expand the w'house, but of course Fast Davey needs the divvies for his Kiwi Lightning McQueen.`


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## kenny (13 October 2022)

Revisiting DDR as one of my perennial favourites. It seems that the SP has taken a battering since the SPP closed out on 23rd September.
The SPP was successful in raising $21.8M at the $10.30 institutional price despite the SP ending lower than that by the end of the SPP period.





This is despite some recent positive news;

locking in Extreme Networks distribution (initially part of acquired Hills subsidiary but uncertain as to whether the US networking vendor would continue the arrangement).
extension of the NVIDIA partnership. _Dicker Data will distribute NVIDIA DGX systems to deliver AI solutions at scale for large enterprises and governments. NVIDIA vGPU (virtual GPU) solutions for virtual desktops and workstations; NVIDIA AI Enterprise software for data science and AI; and NVIDIA enterprise GPUs to accelerate AI, high-performance computing, data science and graphics._
So where does fair value lie for DDR given the down trend we see?


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## galumay (14 October 2022)

kenny said:


> So where does fair value lie for DDR given the down trend we see?




I think the issue is partly that like so many other businesses, DDR was massively over priced, so there is a lot of downward price pressure as the market returns to valuing businesses on real fundamentals instead of price to magic ratios.

I didn't participate in the recent SPP as I thought it was too expensive, and I as you note the market price dropped below the SPP anyway so not sure why anyone participated. 

My range of value is a fraction of the current price, but as my cost basis is about $1.50 I don't let that worry me. I would not be a buyer though at anything like current prices.


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## finicky (14 October 2022)

I read this thread yesterday and did my cafe napkin valuation which agreed with your overvalued comment. It's a company that I would like to have a few shares in one day - although that's looking in the rear vision mirror at past performance.
I gave it arbitrary 'points' for a trend of rising book value while continuing a high return on equity but took the points off for high leverage. Also today I notice the increased inventory and receivables at last report. Maybe that's for a good reason like Codan (CDA) argues. To me it's worth maybe $7 but that's without a discount to make it particularly desirable.

Not Held


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## galumay (14 October 2022)

Yes mate, I have never liked the high leverage, its all for the receivables, company believe its the best capital allocation for this type of business. (given the strength of their margins for a distro they may be right.) I suspect the real reason is so David can have big fat divvy cheques for the race car development. Inventory will roll off, their history of managing working capital is exemplary. I think the metric that uncovers the power of the business model is the reinvestment rate and the ROIIC, (80% & 20%+) 

My range of value is even lower than $7, but if you could get in at that level you would probably do ok over time.


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## kenny (14 October 2022)

One of the perennial appeals that's spruiked about this business is that David Dicker draws no salary from DDR and "lives" off the dividends. Such implied alignment with investors is a compelling story to indicate the commitment he would have to running the business optimally.

Indeed the "insiders of DDR together own over 60% of the company. These factors alone contribute to the SP premium.

Simply Wall St agrees about he troubling debt levels, saying;

_Debt Level: DDR's net debt to equity ratio (*159.5%)* is considered high. 
Reducing Debt: DDR's debt to equity ratio has increased from 134.2% to 175.7% over the past 5 years._

It's hard to say whether a $7 SP would bring this back to a reasonable valuation.


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