ADH - Adairs Limited

[mullokintyre]

ADH absolutely smashed today, down 19%.
Quarterly sales figures well down, expected yearly sales down, not a good look.
Another one of my great investment duds.
But this time I am going to blame covid.
Mick

 

[finicky]

Adairs too huh? I've noticed a couple of discretionary retailers correcting lately and was looking at Kogan (KGN) in particular over the w/e. But in this sub-category (homewares?) I see that Temple & Webster (TPW) is going poorly too.

Both have stand aside charts for me fwiw: TPW might have just broken support @$8 and is looking like a bearish double top whereas this one, ADH, has not yet broken support @ $3 but will look toppy if it does.

Used to hold ADH

5 year Weekly

 

[divs4ever]

i have a fair amount of Consumer Discretionary stocks ( just not ADH , TPW , or JBH )

maybe i should crunch some numbers now share-holder confidence is rattled

good luck folks

 

[mullokintyre]

Like a few others, I am keeping a fair bit cash ready for the next correction/slump/rebalancing/crash.
ADH probably would be one of the ones I look at if the price gets crunched enough.
Sitting on a PE of less than 10, may be a better buy in the future.

 

[mullokintyre]

ADH annual out.
Sales up, EPS and DPS both down.
The co had an IPO at 2.40 back in 2015.
seven years later it is below 2 bucks.
PE around 7.
forecasts for next year is pretty much the same as this year.
If it gets to a 52 week low, I might be tempted.
Mick

 

[frugal.rock]

Chart only.

 

[mullokintyre]

ADH chart shows a recent big jump in this one.
Took a few off the table cos it is probably due for a correction, and my average buy in price is below 2 bucks.
Not sure how the interest rate rises will affect retail sales, so being a bit cautious.
Mick

 

[mullokintyre]

Adairs half yearly shows record sales for the half, up 34 % , EBIT and NPAT up, and EPS up 22% to 12.7 CPS, with a divvy of 8 CPS.
All good, however they suggest that due to those damn 'higher supply Chain costs", the second half will reduce EBIT for the full year.
In something that surprised me greatly, was that in store sales were up 22%, while online sales fell nearly 8%
I really thought that online sales would just keep increasing till the big stores no longer existed.
Will need to look at some of the other retailers to check this result.
Mick

 

[mullokintyre]

ADH hit another 52 week low this morning.
I will be keeping an eye on this one, as although it will definitely have a further fall in sales, I suspect the correction will overshoot.
May take a little time, but a bottom will be found.
Looking to see it go below a buck, maybe even test those mid covid lows of 44cents.
That would be nice.
Mick

 

[finicky]

I would expect lower for ADH, broken support.
Beacon Lighting (BLX) has also broken a level of support.
Both pretty solid earners historically and good dividends.
From Commsec stats it looks like ADH took on a much higher level of gearing FY22.
Nick Scali (NCK) could get more interesting.
Only discretionary retailer I hold is AX1, which I treat as a keeper.

 

[wayneL]

I would expect lower for ADH, broken support.
Beacon Lighting (BLX) has also broken a level of support.
Both pretty solid earners historically and good dividends.
From Commsec stats it looks like ADH took on a much higher level of gearing FY22.
Nick Scali (NCK) could get more interesting.
Only discretionary retailer I hold is AX1, which I treat as a keeper.

Yep, I think lower too. There is an Adairs at the local shopping centre been keeping an eye on. Always freaking empty. You could go apeshyt with an Uzi in there.... There'd be lots if goose feathers flying about, but you'd never hit a human.

Keeping safe for later, but we need this depression out of the way first... much like the whole discretionary retail sector imo.

And the defensiveness still ain't no bargain.

 

[finicky]

You could go apeshyt with an Uzi in there...

You have an interesting way of viewing the world

 

[mullokintyre]

Sp still being put under pressure.
Below 1.40 now.
looking for that typical undershoot, just hope I recognise it when i see it.
Mick

 

[finicky]

I'm not expecting to buy it in this climate. If I do I'll be seeing $1 as a best shot target but with a chance of lower. This comes from the overhead formation above $3 and flipping that distance below. But it's a somewhat arbitrary pick of cues, as the more recent overhead above 2.75 could be chosen, giving an even lower target of 50c, where it reached in the wuhan Flu. Probably mini rallies to contend with. Type of candles combined with volume and momentum should hopefully give a clue. ?‍?

Not Held

WEEKLY 5 YEARS

 

[mullokintyre]

I'm not expecting to buy it in this climate. If I do I'll be seeing $1 as a best shot target but with a chance of lower. This comes from the overhead formation above $3 and flipping that distance below. But it's a somewhat arbitrary pick of cues, as the more recent overhead above 2.75 could be chosen, giving an even lower target of 50c, where it reached in the wuhan Flu. Probably mini rallies to contend with. Type of candles combined with volume and momentum should hopefully give a clue. ?‍?

Not Held

WEEKLY 5 YEARS
View attachment 157962

In this modern era, I have moved on from candles, they never really provided me with the signals.
Problem is, using LEDS has not worked either.
mick

 

[finicky]

A bit of a tangent, but David Jones Stores' early June sales figures have crashed in knee jerk response (they say) to the recent reserve bank rate decisions. Store sales across the board knocked down double digits cf guidance and pcp, including in the wealthy locations like Malvern. They say worst is homewares and big ticket items.
Discretionary retailers mixed today - ADH down only 1c, while CCX up 7%, BLX up 5%

Daily Telegraph article:
"David Jones’ city, suburban and regional stores have experienced double-digit sales retreats – some as much as 30 per cent – thanks to a sharp deterioration in consumer confidence brought on by rising interest rates and a hit to household budgets.
The decision by the Reserve Bank to push up the official interest rate in May and June is being blamed for much of the lightening fast reversal in sales growth as the department store owner grapples with a consumer facing dwindling discretionary spending power.

It can be revealed the nation’s premier up-market department store is struggling to meet management sales targets and budgets for June as shoppers pull back their spending habits to preserve savings for higher mortgage repayments, rents and other bloated cost-of-living expenses."

Not Held

 

[mullokintyre]

ADH annual out and it aint good.
It has increased gross sales for thetenth year in a row, but its all down hill after that.

Market reaction was to knock it down by 14%.
Probably a fair call.
Sold the few I had left at a loss, and unlikely to buy back unless hell freezes over.
Mick
Mick

 

[wayneL]

ADH annual out and it aint good.
It has increased gross sales for thetenth year in a row, but its all down hill after that.
View attachment 161206
Market reaction was to knock it down by 14%.
Probably a fair call.
Sold the few I had left at a loss, and unlikely to buy back unless hell freezes over.
Mick
Mick

I just can't see discretionary retail being much good for the medium term. As for Adairs, I was thinking about picking up some around $1.40 a couple of months ago.

However, I have to walk past an Adairs everytime Mrs drags me in to the local shopping centre.... There is just never anyone in there these days, enough to give me cold feet. To be honest I am struggling how they even managed to increase gross sales, based on my observations.

 

[debtfree]

Chart update ....... has the sellers gone ?

 

[finicky]

Must admit it looks improving but wouldn't like to try to call it longer term.
We'll know soon - Monday 26 Feb.

Not Held

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