DSH - DSHE Holdings

[Gringotts Bank]

Re: DSH - Dick Smith Holdings

Great article on DSH from Forager Funds Management's blog:

https://foragerfunds.com/bristlemouth/dick-smith-is-the-greatest-private-equity-heist-of-all-time/

Interesting thanks. Dick Smith himself wouldn't be happy to see what happened to his old business. afaik, he was as straight as they come in his business dealings.

 

[Ves]

Re: DSH - Dick Smith Holdings

Currently trading for less than Anchorage paid for it.... although, clearly retail investors can't play tricks with funding their purchase with inventory liquidation and just have to watch as management write-down the bloated value of said inventory instead.

Ouch!

I'll be very curious to see if Dick Smith survives. Paying that debt down is going to be really tough without any cash flow and any capital raising will be extremely dilutive if they can even get any willing investors.

 

[skc]

Re: DSH - Dick Smith Holdings

Currently trading for less than Anchorage paid for it.... although, clearly retail investors can't play tricks with funding their purchase with inventory liquidation and just have to watch as management write-down the bloated value of said inventory instead.

Ouch!

I'll be very curious to see if Dick Smith survives. Paying that debt down is going to be really tough without any cash flow and any capital raising will be extremely dilutive if they can even get any willing investors.

Still can't believe that open price... 20c!

This was $2 as recently as August (not that it means anything).

Didn't trade it nearly as well as I should.

 

[notting]

Re: DSH - Dick Smith Holdings

Great article on DSH from Forager Funds Management's blog:

https://foragerfunds.com/bristlemouth/dick-smith-is-the-greatest-private-equity-heist-of-all-time/

Now when DJs gets floated again, everyone go back and read this. Watch to see any kind of run up and short the shi7 out of it when the run up tires or after 12 months!

Also I cannot believe how many analysts where giving this float and subsequent trading prices the thumbs up. I was even abusing some of them in writing at the time!

Here is a note I got from Wise Owl to which I responded basically calling them mental cases.

Investment View

We are attracted to Dick Smith’s new leadership and strong balance sheet. Within a short period, management have achieved an outstanding operational turnaround. Their substantial shareholding incentives further improvement amid a stabilising competitive landscape. Whilst its rebound is expected to moderate, historic brand investment ~$500million and upside to sales per square metre supports the outlook for new investors.

Offer Price: $2.20 | Listing: 4th Dec

Wise Owl are supposted to be savvy smart dudes finding little gems in the market due to their ability to spot smart management and value!! They were certainly not alone either. Fricken bloody hell!

 

[notting]

Re: DSH - Dick Smith Holdings

Under a Bold Heading –
Tim McArthur of the Motley Fool wrote on October 17, 2014 - "3 reasons to buy retail stocks now"
(Whilst The miracle turn around DSH was trading at a heady $2.10 or there abouts.)
"Dick Smith Holdings Ltd, Kathmandu Holdings Ltd and Super Retail Group Ltd: "

"Dick Smith Holdings Ltd (ASX: DSH) this week announced improving sales and stated that it saw significant opportunities to expand its store presence. With the stock trading on a forecast price-to-earnings (PE) ratio of just 10x and sporting a forecast yield approaching 7%, it’s a stock worth considering."

What a miracle.

As a side show Kathmandu was trading at 3.00 or so.

 

[Knobby22]

Re: DSH - Dick Smith Holdings

Yes, retail, competition everywhere including online.

 

[notting]

Re: DSH - Dick Smith Holdings

And I am remaining mindful of this and looking for the after Christmas hangover for an entry on the short side.

written on 15 October 2014.
It got higher than the article suggested, and still is, but the song is the same.

http://www.gizmodo.com.au/2014/10/is-harvey-norman-stock-headed-for-a-crash/

Gerry Harvey’s recent comments on Australia’s high wages were also mentioned as a challenge to the business.

All in all, the 60-page report comes to the conclusion that Harvey Norman as a stock has reached its peak at $3.70 per share:

At 3 year highs of A$3.7 and current valuation, we believe Harvey Norman (ASX: HVN) stock seems overvalued and a compelling short, no durable moat, slow-growth Australian retailer facing multiple headwinds from intense competition. From extensive fundamental analysis of studying competitive position, growth and hundreds of footnotes from public filings over many years, we believe current valuation seems unlikely to be sustained due to slow growth, intense competition exacerbated by limited financial disclosure for investors.

The reason Harvey Norman’s share price got so high, according to the report, isn’t because it’s a good business, but because of positive market forces in Australia like the housing “bubble” and the weak Australian dollar in 2014 compared to the $US.

Watching that resistance at $4.20

 

[joeno]

Re: DSH - Dick Smith Holdings

Might buy in soon. It's still a high revenue / profit business, and for the price a bargain. What do you guys think?

 

[notting]

Re: DSH - Dick Smith Holdings

Electronics retailer Dick Smith has jumped as much as 24.9 per cent on news that Algy Pereira, the boss of Woolworth's Big W division, has resigned to take on a senior role at struggling electronics retailer Dick Smith.
Dick Smith has confirmed Pereira has been appointed director of retail operations but denied speculation he was hired as an immediate replace for chief executive Nick Abboud. Pereira, worked with Mr Abboud at Myer for many years, including two years as general manager of electrical, resigned from his role at BIG W
And this –
Mr Murray, who took the chair in February from Anchorage Capital Partners chairman Phil Cave, denied reports in online trade publications that Mr Abboud had been given four months notice

You can see why they are doing so well, look the the legends they pick out of the pool of carnage.

 

[Tyler Durden]

Re: DSH - Dick Smith Holdings

Might buy in soon. It's still a high revenue / profit business, and for the price a bargain. What do you guys think?

I think it might be a good short to mid-term buy for the prospect of a takeover. However, I don't like the fundamentals of it. I checked out the store yesterday during the so called "sale" which allegedly had 70% off. In the Sydney CBD store, there were probably around 20 people max browsing, and I saw only two people at the counter buying.

I only saw one thing heavily discounted, which was an old PS3 game. Everything else was either slightly discounted or not discounted at all. If they can't attract people during a "70% off" sale, then I don't have confidence that they would be able to attract customers during non-sale times.

Additionally, they seem to be a bit of a mess in terms of what they're selling. They sell phones to computers to tvs to cameras to blenders. I think they would do well to try to specialise in just one or two things. When people want a blender, I doubt they'd think of Dick Smith as their first option.

Anecdotally, my friends and I hardly consider Dick Smith as the first option for even their main products, as they are normally more expensive than JB or other online venues.

It will be interesting to see how they try to turn this around, but I strongly doubt they can.

 

[howmanyru]

Re: DSH - Dick Smith Holdings

Looks like they are trying to become primarily an online retailer. When i try and buy something it's rarely in their shop, and the discounts only apply to online purchases. They left their run too late and can't survive on Dicks legacy alone.

 

[Calvin27]

Re: DSH - Dick Smith Holdings

In the Sydney CBD store, there were probably around 20 people max browsing, and I saw only two people at the counter buying.

I don't have much to add wrt investment on DSH, but Melbourne shops were full to the brim. Full load of staff working seeemingly to the maximum of their ability. Lots and lots of purchases - all counters manned. This is the two main cbd stores in Melbourne. The suburb stores, my mate has advised was no different.

 

[poverty]

Re: DSH - Dick Smith Holdings

I don't have much to add wrt investment on DSH, but Melbourne shops were full to the brim. Full load of staff working seeemingly to the maximum of their ability. Lots and lots of purchases - all counters manned. This is the two main cbd stores in Melbourne. The suburb stores, my mate has advised was no different.

Strange you and your friends have all of the DSH stores under surviellance and scoped out. Noone I know, and I work with a lot of young people, even consider going into a DSH if they live within cooey of a JB-Hifi, let alone bothering to report on it to all and sundry. They have less stuff, a lot of their stuff is seemingly just random **** you wouldn't even expect to be in that kind of store (blenders, wat??) and whatever they have costs more than it should.

 

[notting]

Re: DSH - Dick Smith Holdings

Strange you and your friends have all of the DSH stores under surviellance and scoped out. Noone I know, and I work with a lot of young people, even consider going into a DSH if they live within cooey of a JB-Hifi, let alone bothering to report on it to all and sundry. They have less stuff, a lot of their stuff is seemingly just random **** you wouldn't even expect to be in that kind of store (blenders, wat??) and whatever they have costs more than it should.

Very true.
Further they make a huge mistake in not discounting or even being competitive on the little items. You can get a lot of foot traffic on the small stuff if you promote it right, 'Rivers' comes to mind. The guy who runs that is rich!!
Dick totally fails and makes it obvious they are trying to gouge you on the little stuff, just making you walk out thinking, it's still a losers den.

 

[Calvin27]

Re: DSH - Dick Smith Holdings

Strange you and your friends have all of the DSH stores under surviellance and scoped out. Noone I know, and I work with a lot of young people, even consider going into a DSH if they live within cooey of a JB-Hifi, let alone bothering to report on it to all and sundry. They have less stuff, a lot of their stuff is seemingly just random **** you wouldn't even expect to be in that kind of store (blenders, wat??) and whatever they have costs more than it should.

Not sure what your problem is mate, but I am simply relaying my observations which seem contrary to your experience. Yes, I'd go to MSY before I go to JB and JB before I go to Dickies. That wasn't the point I am making - my point is the fire sales, at least in the melbourne cbd stores are clearing. Take what you will.

I never made the claimed we have all the stores scoped out - only 2 main cbd stores and two in the SE suburbs. If you had any clue about 'young people' you'd know that 80% of the recent visitations were ozbargainers. No need to get worked up over an observation mate.

 

[Smurf1976]

Re: DSH - Dick Smith Holdings

"Old" Dick Smith Electronics pretty much owned the market as the only mainstream retailer that sold actual electronic parts. Sure, there was competition to some extent and it was only ever a niche business but Dick Smith was the name that came to mind for most if they wanted to buy something like that.

"New" Dick Smith Holdings is just another place to buy TV's, phones and kitchen appliances but doesn't have the biggest range or lowest prices in any particular field. So there's no reason to go there given that someone else always has more and/or is cheaper.

Last time I bought anything there would be probably 4 years ago. These days it's either Jaycar or a specialist for actual electronics as such, and anyone from Harvey Norman to Myer to JB Hi-Fi can sell you a new TV.

They've gone down the "little bit of everything but not a lot of anything" track and very rarely does that work. Plenty have tried that over the years and most fail. It's rather hard to be both cheap and up market at the same time, even harder to be an "expert" on everything from toasters to TV's.

"Attempt to please everyone and nobody will like it" are words that come to mind here. The only way you can make that work is if you're big enough to actually do 2 or more different things at once. Eg two radio stations broadcasting from the same studios but targeting completely different audiences. Qantas + Jetstar. Pub / club with 3 dance floors all with different DJ's playing very different music. Etc. In those cases you're offering multiple products to consumers so have the ability to get each of them right.

That isn't really the case for DSH however since the stores aren't physically big enough to have a full range of TV's, blenders and everything in between under the one roof. Someone else always has more and someone else is cheaper too. That being so, there's really no reason to buy things there, a point that many seem to have realised judging by how the company is going.

 

[notting]

Re: DSH - Dick Smith Holdings

"New" Dick Smith Holdings is just another place to buy TV's, phones and kitchen appliances but doesn't have the biggest range or lowest prices in any particular field. So there's no reason to go there given that someone else always has more and/or is cheaper.

Well, unless that is you put out a second downgrade in the space of about 6 weeks and say your writing off stock with 70% discounts. Now that would be a reason to go there!!

And as always, as a pleb who wants to a walk the talk, I did!!!!

I went there today, thinking I'm going to be falling over 60" TVs being thrown away, computers, phones, what ever took my fancy. Hmm to my surprise there was really not that much on offer! Couldn't believe it. Nothing really grabbed me, had it I would have bought it. It looked like someone had busted the door down over night and ripped half the stuff off the shelves. It's a Monday and I'm pretty sure it wasn't a sales rush especially given the lack of customers?? WTF?:dunno: What they can't even give their stuff away with style. Most signs were saying 20% off.

Hey I thought, maybe Dickie is smarter than you think. He's putting all this low balling out there before Christmas to get a rush happening and making some great sales volumes whilst looking like it's not a sale and tricking the competition. Hey smart Dick. Probably not. Just a fricken mess more like it.

Anyway, because I was in a big shopping complex I had the opportunity to check em all out. So I went to Harvey Norman and low and behold, the sales guy in the tech area was really good! He knew as much as I did and all the little secrets like how fricken awesome the windows phone is compare to an Iphone peace of overpriced rubbish. He new about hard drives that will process faster and lazer printer tech and price of toner vs volume and all the little things that most consumers that shop at these places don't really get. It was so much better than the Harvey Norman I went to 12 months ago when they were pathetic. So well done Harvey. JB are always that good or they will find you a guy who is. The fridge guy was not so good. I had to do all his figuring out for him, like the volume vs energy rating and stuff to get the best deal.

Maybe customers all bought the stuff from Dickie on line from their work PCs on a boring Monday morning and they had to rip it off the shelves. I don't know, Just weird. Bought a printer off Harvey too for about $150 less than the one I saw a few hours before at Office Works being about 35% off! Not bad Harvey.

 

[notting]

Re: DSH - Dick Smith Holdings

I suddenly find a plausible explanation for the above experience.

It's an inside job!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

The tail is wagging the dog! -
http://www.news.com.au/finance/business/retail/angry-shoppers-accuse-dick-smith-staff-of-hoarding-items-during-fire-sale/news-story/24ffe5fc9b91f633c0c7ab8c7a757a9d

Unbelievable.

"Our dedicated well trained team of sales professionals," as described by CEO recently!


No Dick Smith sales person said, "Boo" to me, or even looked me in the eye!

Dick Heads.

 

[Knobby22]

Re: DSH - Dick Smith Holdings

I visited the local Dick Smith store to buy a cat 6 cable and to have a look.
Busier than I have ever seen it. Some stuff was disappearing but overall left unimpressed. couldn't buy the cable so went to JBs and got one.

The foot traffic should be enough to get them reasonable figures for December. It won't last though unless they improve the product.

 

[So_Cynical]

Re: DSH - Dick Smith Holdings

Have purchased a couple of things over the last few months at DSH, ordered and paid online and then picked up at the store of my choice a day or 2 later after email confirmation that my order was ready to pick up...a pleasant, simple and value for money experience both times.