HUM - Humm Group

[Trav.]

FXL has retraced since the last posting here ( recent low of $1.80 ) and is having a go at $2 today. ( high of $1.98 at time of posting )

One to watch if it breaks $2 then next resistance @ $2.20

Holding

 

[Trav.]

oh so close, hopefully next week we can continue this little run. up ~ 6.91% for the week

 

[Trav.]

some movement after the close today managed to get SP up to $2 which is always a significant level to reach and hopefully breakthrough tomorrow.

holding

 

[Trav.]

Very disappointing end to this trade as I got stopped out on Monday after the big 11% drop.

1 minute counting the $$$ up a couple of grand then nek minute out on the kerb with with a $1k loss. A bit hard to manage risk when the trade gaps down but in hindsight I should have locked in my profit and moved onto the next trade as there are a couple of signs that I should have noticed but when in a winning trade you can be very biased with what you see on the chart.

Lesson learnt....well hopefully

 

[barney]

Very disappointing end to this trade as I got stopped out on Monday after the big 11% drop.
A bit hard to manage risk when the trade gaps down but in hindsight I should have locked in my profit and moved onto the next trade

Everyone knows your pain Trav. The market is tough at times (especially recently in my view, but maybe that's just my lack of awareness)

I wish I could go back 12 months and re-do a few of my trades as well

In hindsight (mine), taking profits off the table should be seen as a sensible decision (even if the stock goes higher). Getting the timing right is the hard part.

 

[frugal.rock]

Might be time to dust this one off and revisit?
Have released Bundll, a BNPL service through the MasterCard system.
Raiz plans to have a MasterCard through Flexi/ Bundll in near future.
Trading around the $1.90 mark.
Am watching this one.
F.Rock
PS, what do you think @Trav.
Bargain now? Cheaper than January...

 

[Trav.]

PS, what do you think @Trav.
Bargain now? Cheaper than January...

Not for me at the moment, I think that if it breaks $2 then worth looking at it but if you enter now with no clear indication any action then it has the possibility of tying up funds for a period of time.

 

[frugal.rock]

Wise words.
However, it's trend cycle seems to be every 2 to 3 weeks... has been sitting steadily for around 2 weeks with a little spurt a few days ago, then yesterday's down bar...says signal to me? Look for setup?
Will watch a bit today...
F.Rock

 

[Dona Ferentes]

Looking for a player in the Buy Now Pay Later sector that's down 30% for the year?

Hmmm

 

[systematic]

Looking for a player in the Buy Now Pay Later sector that's down 30% for the year?

Hmmm

Well, the stock in this thread (almost) fits the bill, on a YTD basis. That's assuming you meant price, not revenue or some other metric.
You weren't any more specific, so...

 

[Dona Ferentes]

not trying to be too enigmatic, but .... FXL has some similarities, but quite a few points of differentiation, to the new tear-aways
One year chart
Flexigroup FXL .. in purple
AfterPay APT .... in Blue
Zip Co Z1P ...... in Red
Sezzle SZL ...... in Green
Splitit SPT ....... in Brown

But is it a fair comparison? In some ways, yes. Flexigroup, which operates in the sector mainly under the Humm brand, rose almost 12 per cent on Wednesday after it released a trading update that said it now had more than 2.1 million customers across its Australia and New Zealand businesses, having added 380,000 in the past 11 months. But it has two other profitable arms in credit cards and SME lending also make it less of a pure-play buy now, pay later stock

 

[Dona Ferentes]

Humm concentrates on transactions with an average around $1,000; health, solar power and home improvement categories have become key targets. The newer arrivals concentrate around $100-150, which may be more spontaneous decisions and more frequently made.

Humm has a well trialled and tested 'credit decision' engine and a flexible payment structure that lets customers push their payments out up to 60 months.

Humm is only A+NZ focused, whereas the newer BNPL players are looking to grow internationally

Flexigroup has been in the buy now, pay later space for 20 years, and is profitable; its long history might actually count against it in a sector where agile new businesses, without legacy brands or products, arguably look more focused. It is also still in transformation, and has spent the past year consolidating some legacy products and grandfathering others. In the year to May 31, retailers have processed $2 billion worth of transactions on the Humm platform; this is a 25%pa growth.

 

[Dona Ferentes]

I see @frugal.rock has tipped a few pennies into this stock (WZR thread)

flexigroup is a diversified full service payments company with leading offerings in Buy Now Pay Later, revolving credit and SME finance. Serving a broad footprint of millennial spenders, through to young families and small and medium businesses, it facilitates purchases for over 2.2 million customers.

Back of a napkin, it seems some of metrics are fair, but debt is high (its a financial product, so that skews things). Earnings and quality has slipped, but if the new approach, of a coherent offering without legacy products, works, then a trim and focused company could build margins /get back to form.

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

Company says it is growing, then the big question; will the new BNPL players be a block to new customers as they're all competing in their own way in the same area, or will the banks cede space such that there are multiple winners? Customer usage of the products is up to 9 times, a year. Loyalty through the app would drive things (600,000 downloads)?

And don't blow it on international dreams?!?!

 

[Dona Ferentes]

humm 4Q20 retailer update

• humm welcomes high profile retailers in 4Q20 including Temple & Webster, Amart Furniture, Snooze and luxury brand Bally
• Strong online growth continues with 4Q20 ecommerce volume up 315% and total transactions up 447% on 4Q19
• Momentum driven by a record number of ecommerce and instore integrations in 4Q20
• BPAY feature launched in 4Q20 allows customers to pay for bills in manageable interest free instalments with humm at a range of service providers.

humm can now be used to pay a range of bills that offer BPAY. This will enable customers to pay for services including, but not limited to, electricity, gas, telecommunications and school fees, and repay them in budget friendly, interest free instalments at these billers.

- a thinking person's BNPL?

 

[Dona Ferentes]

FXL taking a hit on deteriorating conditions (economic slowdown)? Down 6% this morning

Flexigroup expects to report Cash NPAT for FY20 of $29m. This includes a macro overlay provision of $31m (post tax). This forward looking provision relates to the projected impact of economic conditions due to COVID-19.

flexigroup benefits from a diverse business model with a product suite that spans Buy Now Pay Later (BNPL), credit cards and SME lending, which is a significant strength in a challenging economic environment. flexigroup continues to support its customers and generate sustainable profits. The Company also continues to closely monitor the impacts of COVID-19 on its customers, and for signs of recovery in the domestic and global economy. From the beginning of March 2020, flexigroup has made pre-emptive adjustments across its portfolio to accommodate expected future increases in unemployment.

The Company has also taken a proactive and supportive approach to assist its customers, including an outbound contact program for those who had requested hardship assistance, to discuss their financial position and offer support. This has been well received, and is having a positive effect with customers, many of whom are now feeling in a position to commence repayments or to enter into payment programs. Additionally, the number of hardship requests from existing customers peaked in April 2020 and new requests are now similar to pre-COVID19 levels. Against a challenging backdrop of bushfire relief and COVID-19 support, these actions have helped deliver unaudited net losses2 / average net receivables performance of 4.1% in FY20 (FY19: 4.2%).

 

[Knobby22]

FXL taking a hit on deteriorating conditions (economic slowdown)? Down 6% this morning

Flexigroup expects to report Cash NPAT for FY20 of $29m. This includes a macro overlay provision of $31m (post tax). This forward looking provision relates to the projected impact of economic conditions due to COVID-19.

flexigroup benefits from a diverse business model with a product suite that spans Buy Now Pay Later (BNPL), credit cards and SME lending, which is a significant strength in a challenging economic environment. flexigroup continues to support its customers and generate sustainable profits. The Company also continues to closely monitor the impacts of COVID-19 on its customers, and for signs of recovery in the domestic and global economy. From the beginning of March 2020, flexigroup has made pre-emptive adjustments across its portfolio to accommodate expected future increases in unemployment.

The Company has also taken a proactive and supportive approach to assist its customers, including an outbound contact program for those who had requested hardship assistance, to discuss their financial position and offer support. This has been well received, and is having a positive effect with customers, many of whom are now feeling in a position to commence repayments or to enter into payment programs. Additionally, the number of hardship requests from existing customers peaked in April 2020 and new requests are now similar to pre-COVID19 levels. Against a challenging backdrop of bushfire relief and COVID-19 support, these actions have helped deliver unaudited net losses2 / average net receivables performance of 4.1% in FY20 (FY19: 4.2%).

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They concentrate on the poorer members of society.
I feel that government help has kept a lot of people solvent but as the government lowers the amounts on jobfinder and jobkeeper then this will seriously impact Flexigroup. But... if we are entering a depression they might in the medium term find lots of customers.

 

[Dona Ferentes]

They concentrate on the poorer members of society.
I feel that government help has kept a lot of people solvent but as the government lowers the amounts on jobfinder and jobkeeper then this will seriously impact Flexigroup. But... if we are entering a depression they might in the medium term find lots of customers.

too true. First the bait is offered, then there is a virtue signal of "proactive and supportive approach to assist its customers". Got to keep regulators happy.

Comsumption; a modern disease.

 

[frugal.rock]

One to revisit IMO.
Very much sideways action of late from which I am anticipating a change of tone once yearly is released and dividend announced.

 

[Dona Ferentes]

FY20 RESULTS HIGHLIGHTS
• FY20 Statutory Net Profit After Tax (NPAT) of $21.4m and Cash NPAT1 of $29.2m, reflecting COVID-19 macro overlay provision
• 2.3 million active customers, up 30% on prior year
• 73,000 retail and commercial partners, up 13% on prior year
• $2.5 billion in transaction volume, up 17%2 on prior year
• Cost to income ratio of 49% (FY19: 48%)

STRATEGY UPDATE AND EQUITY RAISING
• Continuing to deliver on our key strategic pillars with significant rationalisation of products while achieving double digit volume growth and strong customer engagement
• flexigroup products will unify under our most recognised and loved brand, humm, to create a seamless checkout ecosystem to harness the natural synergies across our consumer and SME offerings
• Announcing an equity raising via a 1 for 3.20 entitlement offer with total offer size of ~$140 million and total estimated underwritten amount of ~$115 million to provide balance sheet flexibility and support the sustainable and profitable growth outlook

Entitlement Offer price of A$1.14 per new share which represents:
>> 12.6% discount to FXL's closing price of A$1.305 on 25 August 2020.
>> 10.0% discount to the theoretical ex-rights price (TERP) of A$1.266

 

[frugal.rock]

I guess I can get an extra 228 shares through the offer then? (Hold 730 currently)
Do I wait for a mail out? All new to me... Cheers.