JBH - JB Hi-Fi

[Boggo]

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.

I understood what you were saying hiddencow. I have seen a few on here quote high yields but when you look at what the stock has done then it is obvious why the yield is high.
I think the TLS actually got to around 9 or 10% at one point when it was falling.

If you can get a rising price and a company maintaining a constant yield then you have the best of both worlds.

Just as an aside, the JBH fundamentals could be another topic, their annual EPS % is at single digits for the first time in 10 years and their profit this year was less than it was in 2006.

Hope it does a run up for you, Cheers.

 

[hiddencow]

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?

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

And if it raises to 20, how can I justify not buying at 16? If I knew it would fall to 10-12 then I would sell everything and short the crap out of it and reverse my position 180 degrees at the bottom. But sadly I don't. Like I said, I don't want to get into a debate. I know nothing about technical analysis and don't really care.

I understood what you were saying hiddencow. I have seen a few on here quote high yields but when you look at what the stock has done then it is obvious why the yield is high.
I think the TLS actually got to around 9 or 10% at one point when it was falling.

If you can get a rising price and a company maintaining a constant yield then you have the best of both worlds.

Just as an aside, the JBH fundamentals could be another topic, their annual EPS % is at single digits for the first time in 10 years and their profit this year was less than it was in 2006.

Hope it does a run up for you, Cheers.

Telstra div yield got very closer to 11%. I bought in around 10.5%, wasn't too worried when it fell a little further and the yield went higher.

You must be looking at the wrong figures.
Profit in 2006 26.85m and EPS was 24.53
Profit in 2014 126.89m and EPS was 126.89

 

[Boggo]

My interest in JBH was that I held it my SMSF until early this year.

Below is the map of JBH that is my influence.

 

[Boggo]

...
You must be looking at the wrong figures.
Profit in 2006 26.85m and EPS was 24.53
Profit in 2014 126.89m and EPS was 126.89

Trying to type too quickly between phone calls, that should have read 2011, not 2006 and the EPS is the EPS growth which is now single digits.

 

[tech/a]

My interest in JBH was that I held it my SMSF until early this year.

Below is the map of JBH that is my influence.

I know nothing about technical analysis and don't really care.

Ok

ill just speak to myself then.
Clearly there are no areas of support on Boggos chart.
Lower highs and lower lows nothing remotely indicating a change in sentiment.

'Now I'm no Fundi but Id have thought a decline in the AUD would affect JBH buying power and as such its bottom line

This is looking pretty sick and to take a long now IS TECHNICALLY FOOLISH---in my not so humble opinion.

 

[Julia]

I have seen a few on here quote high yields but when you look at what the stock has done then it is obvious why the yield is high.
I think the TLS actually got to around 9 or 10% at one point when it was falling.

Clearly there are no areas of support on Boggos chart.
Lower highs and lower lows nothing remotely indicating a change in sentiment.

+1 to both Boggo's and Tech's remarks.

I've been influenced to buy partly for grossed up yield, but only when the stock has previously met my criteria in other respects.
Will never buy a falling stock. It still seems a popular thing to do, however. Didn't work out so well with some now well known examples like ABC Learning et al.

 

[McLovin]

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've thought JBH has problems for years (I've said it several times in this thread). This is a company that made its fortune selling cd's and video games. Obviously that business is going to disappear. They also used to get the convenience factor with things like memory cards but they don't really anymore and margins in that business have compressed. The pricing difference was extortionate before the internet really took hold. The move in to whitegoods explains most of the GPM uplift. I think they get interesting below $10.

 

[VSntchr]

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

Why so serious!?

Was just adding to the humour which the techies so kindly started!

 

[hiddencow]

I've thought JBH has problems for years (I've said it several times in this thread). This is a company that made its fortune selling cd's and video games. Obviously that business is going to disappear. They also used to get the convenience factor with things like memory cards but they don't really anymore and margins in that business have compressed. The pricing difference was extortionate before the internet really took hold. The move in to whitegoods explains most of the GPM uplift. I think they get interesting below $10.

I agree that their cds, dvds and video games will continue to deminish. This next year will probably be somewhat offset from increased video game sales for PS4s and Xbox ones as more people get these consoles. Those are the games which will continue to sell while PC games will be pirated or purchased digitally. There is also a new nintendo 3DS console being released later this year. Music and movies though are probably doomed, hopefully this is the floorspace they are using to bring in their home products.

I think as long as people keep being attracted to the latest gadget, JBH will be in fine shape. There will be ups and downs though with release cycles. Population growth and the overall economy and levels of descretionary (although some people would put their phones ahead of food) income will have a big impact as well. Future technology advances and uptake by consumers is also important. For example 4k televisions and higher resolution media will have an impact if embraced by the consumer and whatever else apple decides to release. Apple super duper retina TV please.

In terms of competition, I think JBH will always have a strong position. Electronics while being more expensive in Australia than overseas, isn't double or triple the price like with clothes. When you add in the shipping costs, the slightly cheaper price is often outweight by being able to get it immediately and easier waranty claims.

There are risks there but I like the prospects of this one in the future.

 

[burglar]

... There are risks there but I like the prospects of this one in the future.

Don't fall in love with your shares!
They are just 1's and 0's in someone's computer.

They don't love you back!!





Disclosure: I do not hold JBH long and never have!

... and I have never, ever shorted!

 

[KnowThePast]

+1 to both Boggo's and Tech's remarks.

I've been influenced to buy partly for grossed up yield, but only when the stock has previously met my criteria in other respects.
Will never buy a falling stock. It still seems a popular thing to do, however. Didn't work out so well with some now well known examples like ABC Learning et al.

In defence of that...

JBH is current on PE of ~12 and P/Book of over 5. Not too expensive perhaps, but certainly not cheap.

There's a massive difference in buying a falling expensive share, and a falling cheap share.

There's also a massive difference in expecting to be right every time, versus a positive expectancy of a diversified group of stocks.

Yes, ABC, Forge, etc are going to happen. But if you bought 50 falling stocks, at a PE, of say, less than 5, what do you think would be the likely outcome?

 

[tech/a]

In defence of that...

JBH is current on PE of ~12 and P/Book of over 5. Not too expensive perhaps, but certainly not cheap.

There's a massive difference in buying a falling expensive share, and a falling cheap share.

There's also a massive difference in expecting to be right every time, versus a positive expectancy of a diversified group of stocks.

Yes, ABC, Forge, etc are going to happen. But if you bought 50 falling stocks, at a PE, of say, less than 5, what do you think would be the likely outcome?

Don't know do you have figures?

 

[KnowThePast]

Don't know do you have figures?

I do, and they support what I've said. And it's not just me, there's been plenty of studies in various markets that observed the same.

What I was mainly getting at, is that it is wrong to say that it is always right/wrong to buy when the price is moving down/up. Context and other data are a lot more important.

In fact, adding price action to any fundamental backtesting scenario usually makes little difference. That is, a low PE strategy tends to overperform the average - adding extra buy/sell triggers based on price action makes little difference.

To be honest, I've never seen a convincing argumest for buying, or not, into a falling, or rising share price. Not one substantiated by data anyway.

 

[galumay]

I do, and they support what I've said. And it's not just me, there's been plenty of studies in various markets that observed the same.

What I was mainly getting at, is that it is wrong to say that it is always right/wrong to buy when the price is moving down/up. Context and other data are a lot more important.

......

Agreed, some of my best buys have been in companies that are falling hard, thats part of the game for a contrarian, fundamental investor!

Its about understanding why the market is pricing a share at a certain level and if its mis priced then taking the opportunity.

Mind you, JBH wouldnt be a company I would buy into currently!

 

[tech/a]

I do, and they support what I've said. And it's not just me, there's been plenty of studies in various markets that observed the same.

What I was mainly getting at, is that it is wrong to say that it is always right/wrong to buy when the price is moving down/up. Context and other data are a lot more important.

In fact, adding price action to any fundamental backtesting scenario usually makes little difference. That is, a low PE strategy tends to overperform the average - adding extra buy/sell triggers based on price action makes little difference.

To be honest, I've never seen a convincing argumest for buying, or not, into a falling, or rising share price. Not one substantiated by data anyway.

So you have or you haven't?

I have a lot of papers I keep on various academic trials
Few have any practical value to a trader as they are put together with academic logic---which the market tends to have a habit of smashing.

Fortunately I have my own academic and we are approaching many questions from a trading perspective academically----

 

[galumay]

Fortunately I have my own academic and we are approaching many questions from a trading perspective academically----

GOLD! I think this thread is developing some of the best of ACF's tongue in cheek, subtle humour!

 

[KnowThePast]

So you have or you haven't?

I have a lot of papers I keep on various academic trials
Few have any practical value to a trader as they are put together with academic logic---which the market tends to have a habit of smashing.

Fortunately I have my own academic and we are approaching many questions from a trading perspective academically----

Here's what I get for ASX (partial) over the last 10 years:

Trades kept for 1 year. No dividends or interest on cash balances included. No averaging up or down.

Buy when PE < 5 and Current price 20% less than 1 month ago.
344.77%

Buy when PE > 12 and Current price 20% less than 1 month ago.
-18.04%

XAO
45.7%


What do you have?

DISCLAIMER: Lots of important detail omitted. Use at your own risk.

 

[tech/a]

Here's what I get for ASX (partial) over the last 10 years:

Trades kept for 1 year. No dividends or interest on cash balances included. No averaging up or down.

Buy when PE < 5 and Current price 20% less than 1 month ago.
344.77%

Buy when PE > 12 and Current price 20% less than 1 month ago.
-18.04%

XAO
45.7% What do you have?

DISCLAIMER: Lots of important detail omitted. Use at your own risk.

WOW

How did you test this.
I'd like to see the figures
Infact I'll pay for them
If it was that easy every managed fund in the world would
Be buying all stocks with a P/E under 5 that's pulled back 20%
And holding for a year
Private mail me with details.

 

[McLovin]

GOLD! I think this thread is developing some of the best of ACF's tongue in cheek, subtle humour!

That's one way of putting it!

 

[skyQuake]

WOW

How did you test this.
I'd like to see the figures
Infact I'll pay for them
If it was that easy every managed fund in the world would
Be buying all stocks with a P/E under 5 that's pulled back 20%
And holding for a year
Private mail me with details.

+1

Its kind of hard to test while being mindful of
-survivorship bias
-when do you rebalance?
-allocations/weightings?
-are you looking at asx200 or bigger universe
-liquidity