JBH - JB Hi-Fi

[TPI]

Long since?

How long will you remain long?

Not that long in the end, down 10% is enough for me - time to cut losses and lesson learned!

I've had to re-assess my original premise for investing and whether it really stacks up.

I think I under-estimated the online price differential without being fully aware of who the other online-only threats may be.

For an i-Pad Air 32GB see the price comparison below:

JBH - $698 (in-store pickup only)
Yatango - $630+delivery fee (not sure exact amount, delivery only)
DSH - $623 (delivery and in-store pickup)
Kogan - 613 (delivery only)

The JBH price proposition doesn't seem to stack up and they don't offer delivery either.

Though JBH does offer a voucher to go with this sale of up to 25% off up to a $200 spend on certain items.

Maybe they were a price leader in the past, but not so anymore.

New technology product pipeline may help sales but won't change the competitive threats.

Hard to say whether the home appliances and commercial business will really do well enough to offset weaker performance here.

 

[VSntchr]

Not that long in the end, down 10% is enough for me - time to cut losses and lesson learned!

I've had to re-assess my original premise for investing and whether it really stacks up.

Hard to say whether the home appliances and commercial business will really do well enough to offset weaker performance here.

Is JB Hi Fi scrapped from your investment list now? Or at what price will you revisit?

Good job on being decisive, hopefully you made the right choice

 

[TPI]

Is JB Hi Fi scrapped from your investment list now? Or at what price will you revisit?

Good job on being decisive, hopefully you made the right choice

Hi VSntchr,

It's not completely off the list as such, I'll still be monitoring it over the next couple of reporting periods.
I haven't got a firm price at which to revisit it yet as it depends more on some qualitative factors.

If JBH can lower prices and be a genuine price leader and also offer timely delivery on more products then I think they would be more attractive.
Their cost of doing business (CODB) is 15% vs 19% for DSH, so there must be some more room to do this, though I don't know what this figure would be for online-only retailers.

Having an online site and not offering delivery on all products doesn't make sense to me.
DSH offers 3-5 days delivery on the products I checked.
Yatango I'm not sure about as you had to register and get to checkout before seeing this?!
And for Kogan on the i-Pad it said "leaves warehouse in 1-2 weeks" - so online-only, though cheaper is still not yet at an optimal service from this brief sample size.

I think Amazon in the US does free delivery within 1-2 days from what I read, and with low prices on products too.

Also I think the online-only retailers are not necessarily disadvantaged with a lack of store presence as there is nothing stopping someone from going into JBH or DSH and checking out products, then going online and purchasing at Kogan for cheaper.

I think JBH is still a quality business, it is just a matter of how they negotiate headwinds with increased competition locally and which may also come from outside Australia.

On balance I felt that there were probably lower risk and better return alternatives for my capital than holding on to JBH at present given the recent selling pressure and headwinds.

 

[goccipgp]

JBH seems to have support at 16.48 and upside resistance at 18.686. It has an ongoing P/E of 13.80, which indicates that it is undervalued. Technical buying signal at au stoxline.

 

[galumay]

JBH seems to have support at 16.48 and upside resistance at 18.686. It has an ongoing P/E of 13.80, which indicates that it is undervalued. Technical buying signal at au stoxline.

P/E is not a reliable indicator of value.

As I have noted before, not quite sure why you post the buy/sell signals of a commercial service like stoxline, it looks spammy to be honest and its difficult to see how it adds any value to the thread.

 

[Porper]

P/E is not a reliable indicator of value.

As I have noted before, not quite sure why you post the buy/sell signals of a commercial service like stoxline, it looks spammy to be honest and its difficult to see how it adds any value to the thread.

If you aren't affiliated to that company I doubt they'd want you giving their buy/sell signals.

However, looking at the chart it's difficult to see how they are bullish.

1. Support has given way meaning there is now resistance just above current levels.
2. Volume has increased during the latest sell-off.
3. Next zone of support $16.00 - $15.50.

Also, their products look outdated...they need to appeal to the younger generation i.m.o. Sales are also under pressure. All in all not a lot to be bullish about. A great contrarian indicator though!!

 

[hiddencow]

I'm in!
Technical gurus will probably tell me I'm being foolish but couldn't resist at current prices.

I see JBH is the leading electronics retailer in the country. Their fortunes will be dependent on new products and demand and the overall economy affecting people's discretionary income. I don't see Australians not spending any money on electronics anymore.

I'm hopefuly of growth in the medium to long term. In the meantime happy to collect my over 5% fully franked dividend.

 

[tech/a]

I'm in!
Technical gurus will probably tell me I'm being foolish but couldn't resist at current prices.

I see JBH is the leading electronics retailer in the country. Their fortunes will be dependent on new products and demand and the overall economy affecting people's discretionary income. I don't see Australians not spending any money on electronics anymore.

I'm hopefuly of growth in the medium to long term. In the meantime happy to collect my over 5% fully franked dividend.

Your being foolish

 

[Boggo]

Your being foolish

Maybe not tech/a.
That dividend yield is going to jump all the way to 6% if the stock goes down to $14, you're doing it all wrong

 

[McLovin]

Maybe not tech/a.
That dividend yield is going to jump all the way to 6% if the stock goes down to $14, you're doing it all wrong

And Joe wonders why newbies don't bother with this forum.

 

[tech/a]

And Joe wonders why newbies don't bother with this forum.

Oh where's your sense of humour!

 

[hiddencow]

Your being foolish

*You're

That's all I got

 

[Joe Blow]

I'm all for a sense of humour and lightening the mood... but it would be nice to see some serious analysis and discussion too.

Can't we have both?

 

[tech/a]

I'm in!
Technical gurus will probably tell me I'm being foolish but couldn't resist at current prices.

I see JBH is the leading electronics retailer in the country. Their fortunes will be dependent on new products and demand and the overall economy affecting people's discretionary income. I don't see Australians not spending any money on electronics anymore.

I'm hopefuly of growth in the medium to long term. In the meantime happy to collect my over 5% fully franked dividend.

Such a serious mob here.
I was simply complying.

 

[McLovin]

Such a serious mob here.
I was simply complying.

My comment wasn't directed at your post.

 

[Boggo]

I'm all for a sense of humour and lightening the mood... but it would be nice to see some serious analysis and discussion too.

Can't we have both?

Actually the serious bit is the fact that the yield percentage figure is very misleading and will continue to rise in a falling stock, that was the probably not so subtle message in my post.
It is a point that some of our more learned readers would pick up on, others obviously may see the post as something closer to their level of understanding and would instantly respond accordingly.

Bottom line, buying a falling stock because the dividend yield is high is an expensive way of getting franking credits.

 

[McLovin]

Bottom line, buying a falling stock because the dividend yield is high is an expensive way of getting franking credits.

Except, bottom line, hiddencow never said he was buying because of the dividend. He gave a paragraph explaining his reasoning: That JBH was a largest electronics retailer, that people will continue to buy electronics and that he thinks there will be medium and long term growth. He added the final caveat that until the market turns he's happy to collect the dividend. You've described your response perfectly.

It is a point that some of our more learned readers would pick up on, others obviously may see the post as something closer to their level of understanding and would instantly respond accordingly.

 

[hiddencow]

And I would argue buying a stock that has fallen is a good thing because you get a higher yield. It's only where that yield is not sustainable that it is bad. What the price will do in the future I have no idea. I do think the profits and cash flows will be good though and that is why I have bought.
I wasn't trying to start another technical vs fundamental analysis debate, I don't really care.
My comment was just acknowledging that my purchase was probably against technical principles, not trying to offend any ppl on here.

 

[VSntchr]

My comment was just acknowledging that my purchase was probably against technical principles.

Well, JBH is perhaps a buy if your using a short term bollinger band strategy

 

[tech/a]

And I would argue buying a stock that has fallen is a good thing because you get a higher yield. It's only where that yield is not sustainable that it is bad. What the price will do in the future I have no idea. I do think the profits and cash flows will be good though and that is why I have bought.
I wasn't trying to start another technical vs fundamental analysis debate, I don't really care.
My comment was just acknowledging that my purchase was probably against technical principles, not trying to offend any ppl on here.

No offence--I find fudies easier to upset than techies---
I cant see how you can justify buying a falling stock with no knowledge as to wether it is going to continue.
If this falls to 12-10 or less how can you justify a buy at 16?

Well, JBH is perhaps a buy if your using a short term bollinger band strategy

Why would you use a Bollinger strategy its simply a displaced 20 period M/A
Reflecting past.