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Whoa. Talk about being put in your place. My source was obviously rubbish.
Myer IPO
- Thread starter stocksontheblock
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lol, just check your sources carefully. I for one, have been burnt by crikey too many times!
"Myer Group today said it plans to raise up to $2.34 billion through an initial public offering as it looks to re-list on the Australian Stock Exchange."
i read the above in The Australian and am just wondering what do they mean re-list??? if it's an IPO, wouldn't that be list rather than re-list? or has Myer been listed on ASX before?
i apologise in advance for my ignorance.
i read the above in The Australian and am just wondering what do they mean re-list??? if it's an IPO, wouldn't that be list rather than re-list? or has Myer been listed on ASX before?
i apologise in advance for my ignorance.
Myer has previously been listed under Coles-Myer Ltd until Myer was sold off.
Coles used to be CML and is now CGJ
thanks Gillie for the reply
however there was no CGJ when i was searching it on asx and comsec?
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did anyone actually take up this offer?
i'd be interested to know your reasoning why?
i'd be interested to know your reasoning why?
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There is not much in it for stags. It's overpriced. It may go up a little on opening but my guess is it will finish down on the first day.
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Coles was part of Coles Myer purchased by Wesfarmers code WES
This is the most over priced IPO in history, and is a disgrace that the banks, vendors, board and management involved.
Consider this;
- The IPO price implies an EBIT multiple of 14-16x EBIT (why not by a true high growth retailler such as TRS, JBH, PMV, or Super Cheap for a similar price? - of buy SFH for a genuine value buy)
- It has no "real" sales growth, and has no track record of successful store roll out
- it is a capital intensive, and has a major store upgrade program needed, and a need to upgrade its point of sale system in 2011 at a cost of ~$100m
- it does not own its its 2 key stores, unlike DJ's.... because myer sold their melbourne stoire for $600m++.... and therefore should not be compared to DJS in PE, margins, or risk.... it is materially inferior.
- Myer is losing market share to discount department stores such as Target and Big W
- Its cost upside has been stripped....
Then overlay that TPG (the vendors) have a shocking track record of IPOing businesses at overpriced levels (see Debenhams in the UK.... another department store chain).... and will likely sell 100% of their stock, so couldnt care less when it trades down post IPO....
People who buy stock in this IPO are suckers for a pretty girl on the cover of a prospectus, or are satisfied with a 10% upside and 30% down side trade off (i.e. idiots).
Good luck to Myer management when all their customers are pissed at them for convincing them to buy Myer stock, and when the stock is underwater, they vent their anger by shopping at DJ's instead....
Consider this;
- The IPO price implies an EBIT multiple of 14-16x EBIT (why not by a true high growth retailler such as TRS, JBH, PMV, or Super Cheap for a similar price? - of buy SFH for a genuine value buy)
- It has no "real" sales growth, and has no track record of successful store roll out
- it is a capital intensive, and has a major store upgrade program needed, and a need to upgrade its point of sale system in 2011 at a cost of ~$100m
- it does not own its its 2 key stores, unlike DJ's.... because myer sold their melbourne stoire for $600m++.... and therefore should not be compared to DJS in PE, margins, or risk.... it is materially inferior.
- Myer is losing market share to discount department stores such as Target and Big W
- Its cost upside has been stripped....
Then overlay that TPG (the vendors) have a shocking track record of IPOing businesses at overpriced levels (see Debenhams in the UK.... another department store chain).... and will likely sell 100% of their stock, so couldnt care less when it trades down post IPO....
People who buy stock in this IPO are suckers for a pretty girl on the cover of a prospectus, or are satisfied with a 10% upside and 30% down side trade off (i.e. idiots).
Good luck to Myer management when all their customers are pissed at them for convincing them to buy Myer stock, and when the stock is underwater, they vent their anger by shopping at DJ's instead....
I cannot beleive the stupidity of some people....
..... if you think the vendors will sell this at a price that facilitates a stag, you are on crack.This stock will be down a minimum of 15% by 30 June 2010.
skc
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I seriously doubt this is a stag... I have no idea where the term comes from but stag gives me the impression of a horse, jumping. I see this may be as a frog - jumps up in order to dive into the water.
How much do the index funds have to buy? Do they have to buy straight away or they re balance at month end? Can't wait to run a long DJS / short Myer pair when they are done.
May be they should create a short sell facility, like an anti-IPO or IPS (initial public shorting)? That way more fans of Hawko can actually get on the IPO.
How much do the index funds have to buy? Do they have to buy straight away or they re balance at month end? Can't wait to run a long DJS / short Myer pair when they are done.
May be they should create a short sell facility, like an anti-IPO or IPS (initial public shorting)? That way more fans of Hawko can actually get on the IPO.
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I cannot beleive the stupidity of some people....
This stock will be down a minimum of 15% by 30 June 2010.
Thus, stag! Everyone knows its overprices but insto underallocation ensures that there will be some buying support - at least initially. Funds are already rotating out of DJS to MYF when it gets put into the index.
The big 5 insto's arent idiots mate. The IPO managers are trying to use retail demand to squeeze insto's into a smaller book. I hope they find that offshore instos tell them to jump (as they should following Debenhams) and the local boys realise they have the whip hand and go on a buying strike.... this will leave a very thinly covered book.... which will hopefully force a reprice downward.... unfortunately if it doesnt, the instos who play will end up with more stock than they want, and they stock will tank for a few months post IPO before stabalisation as retail investors and over weight instos sort their **** out....
It will be an awesome deal for TPG, but I hope the instos force a repricing back to ~8-9x EBIT valuation (about $1.8-2.0bn).... where a low growth but sold retailler belongs.... TPG will still make a packet, but atleast not screw honest investors ...
A stag is a 50/50 bet here.... and if you get it wrong, you will likely torch more than the 5% upside.
No it didn't past my first rule and a very important one
Myers 160M Net Profit
Want to rise 2.3B for the float
so shareholder equity is 2.3B
160/2300 = 6.8% Return on Equity
Way too low, way below average, way not enough to compensate risk for
holding stock, way over price
Quick, easy calculation anyone can use don't need some analyst to tell you
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Agree with most of that, however as you said, instos arent stupid. They could jump into the bookbuild and force the price towards the top of the range, then face the risk of having it gap down when it reopens. OR they could sit out the insto offer, and buy on open; Significantly limiting their risk (though also foregoing some potential stag). If lots of instos cancel or scale back in the bookbuild process, they'll keep prices at the bottom of the range.
Hopefully they've learnt their lesson from Graincorp's bookbuild...
Having said that, I would love to short it post IPO though.
Hey ppl, quick question regarding the IPO.
Where will the shares turn up, in terms of my trading account? No where does it ask for my SRN or anything so how will they be able to assign it to a particular account of mine...I want to have the option to sell it on the first day available to me.
Thanks
Where will the shares turn up, in terms of my trading account? No where does it ask for my SRN or anything so how will they be able to assign it to a particular account of mine...I want to have the option to sell it on the first day available to me.
Thanks
Anyone with any views/info on SFH?
Seems like a good buy...P/E Ratio ~9.6, retail sector going strong...
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myer ipo & comsec firm broker allocation
anyone going to take up this offer?, also would you be able to apply through both broker & being a myer 1 member? assuming it will be wildly oversubscribed from people looking for a stag profit, i see this as a hedging bet. any thoughts? pros / cons
anyone going to take up this offer?, also would you be able to apply through both broker & being a myer 1 member? assuming it will be wildly oversubscribed from people looking for a stag profit, i see this as a hedging bet. any thoughts? pros / cons
After due consideration I have decided to avoid this one.
Some of the commentary that helped me decide:
Marketing academic Dr Joy Evans: "If I wasn't worried about a short term return then I still think they're a good long term bet. I won't be buying"
Banking and finance academic Peter Swan: "I wouldn't put my fortune if I had a fortune into it but my wife is insisting I buy it. She likes the way the stores are now and says they've improved a lot."
Investors Mutual investors director Anton Tagliaferro called the float "mutton dressed up as lamb".
"I recommend retail investors wait a year or two before looking at buying into Myer shares as there is a danger it has been dressed up for the float."
Dalton Nicol Reid chief investment officer Jamie Nicol said he liked David Jones more than Myer for a retail stock.
"They (Myer) have cut costs and done some sensible things to improve the supply chain, but even though it is priced like DJs, which has a well-established niche, Myer is more a mass market department store which competes with category killers like Harvey Norman ... As a result, we prefer DJs and now, with a rate rise, it's going to get harder for retail."
Kieran Kelly of boutique firm Sirius: "Our clients avoided the disastrous string of IPOs coming out of the venture capital market in recent years Pacific Brands, Repco, Emeco and Boart Longyear to name a few - this looks like another one."
IG Markets research analyst Ben Potter: "(You've got Myer) trying to flog an expensive product to ill-informed retail investors that get taken away by the marketing hype."
Fund manager Marcus Burns said the Myer float was "grossly overpriced and opportunistic".
"It is galling that, time and time again, venture capitalists and private equity firms rip the bones out of an asset and then flog it to the public in an IPO which will only make them rich -- not the new shareholders who buy into the float. The growth story of Myer is unlikely to materialise."
An analyst at stockbroker Joseph Palmer & Sons wrote in a note to clients: "I would argue that the low-hanging fruit has already been plucked from the Myer tree and the big winners here are likely to be the private equity sellers."
Share analyst Roger Montgomery: "Myer is overvalued, even at the low end of the pricing range"
The Australian Criterion columnist Tim Boreham: "Investors shouldn't clamour for a slice of Myer simply on the Edmund Hillary 'because it's there' motive. Other retail listings, notably Rebel Sport and Kathmandu, are in the offing so they'll have a smorgasbord to choose from.
"Just as Boxing Day bargain hunters expect cut-price merchandise, investors should expect the offer price to reflect the uncertainties inherent in the Myer turnaround story."
Australian Financial Review reporter Sue Mitchell: "The prices sought by Myer's private equity owners will leave little room for error in the event of deteriorating economic or retail conditions, cost overruns, problems implementing new IT systems or new stores falling short of objectives. It's a long list. "
Sydney Morning Herald commentator Malcolm Maiden: "At $4.90 a share, Myer is fully priced for a journey it has not yet taken: the turbo-charging of the lower-cost, higher-return operating base that its chief executive, Bernie Brookes, has engineered through the delivery of revenue growth,"
I think I will avoid the risk for the likelihood of a 2-5% first day stag and wait for the price to drop about 15 - 20% before I buy in.
Some of the commentary that helped me decide:
Marketing academic Dr Joy Evans: "If I wasn't worried about a short term return then I still think they're a good long term bet. I won't be buying"
Banking and finance academic Peter Swan: "I wouldn't put my fortune if I had a fortune into it but my wife is insisting I buy it. She likes the way the stores are now and says they've improved a lot."
Investors Mutual investors director Anton Tagliaferro called the float "mutton dressed up as lamb".
"I recommend retail investors wait a year or two before looking at buying into Myer shares as there is a danger it has been dressed up for the float."
Dalton Nicol Reid chief investment officer Jamie Nicol said he liked David Jones more than Myer for a retail stock.
"They (Myer) have cut costs and done some sensible things to improve the supply chain, but even though it is priced like DJs, which has a well-established niche, Myer is more a mass market department store which competes with category killers like Harvey Norman ... As a result, we prefer DJs and now, with a rate rise, it's going to get harder for retail."
Kieran Kelly of boutique firm Sirius: "Our clients avoided the disastrous string of IPOs coming out of the venture capital market in recent years Pacific Brands, Repco, Emeco and Boart Longyear to name a few - this looks like another one."
IG Markets research analyst Ben Potter: "(You've got Myer) trying to flog an expensive product to ill-informed retail investors that get taken away by the marketing hype."
Fund manager Marcus Burns said the Myer float was "grossly overpriced and opportunistic".
"It is galling that, time and time again, venture capitalists and private equity firms rip the bones out of an asset and then flog it to the public in an IPO which will only make them rich -- not the new shareholders who buy into the float. The growth story of Myer is unlikely to materialise."
An analyst at stockbroker Joseph Palmer & Sons wrote in a note to clients: "I would argue that the low-hanging fruit has already been plucked from the Myer tree and the big winners here are likely to be the private equity sellers."
Share analyst Roger Montgomery: "Myer is overvalued, even at the low end of the pricing range"
The Australian Criterion columnist Tim Boreham: "Investors shouldn't clamour for a slice of Myer simply on the Edmund Hillary 'because it's there' motive. Other retail listings, notably Rebel Sport and Kathmandu, are in the offing so they'll have a smorgasbord to choose from.
"Just as Boxing Day bargain hunters expect cut-price merchandise, investors should expect the offer price to reflect the uncertainties inherent in the Myer turnaround story."
Australian Financial Review reporter Sue Mitchell: "The prices sought by Myer's private equity owners will leave little room for error in the event of deteriorating economic or retail conditions, cost overruns, problems implementing new IT systems or new stores falling short of objectives. It's a long list. "
Sydney Morning Herald commentator Malcolm Maiden: "At $4.90 a share, Myer is fully priced for a journey it has not yet taken: the turbo-charging of the lower-cost, higher-return operating base that its chief executive, Bernie Brookes, has engineered through the delivery of revenue growth,"
I think I will avoid the risk for the likelihood of a 2-5% first day stag and wait for the price to drop about 15 - 20% before I buy in.
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Seriously people, for all the newbies who have been swept up by the Myer, Jennifer Hawkins fashion catalogue accidently named a prospectus.........
Your enthusiasm for stock investing is wonderful........it's reassuring that stocks will always have a romance, at least before you buy your first dog of a stock....
Seriously guys, have a look around and do your research......I'm sick of seeing the punters mercilessly fleeced by the Macquaire banks and private equity firms........
Even if Myer was sold off at half its listed price, it would not be a standout buy.........all the other analysis is just noise
If you actually want to make money, have a look at some of the other wonderful retailers trading on the stock market.......you can buy the cream on a similar valuation to Myer.........and you can buy better businesses than Myer for half the valuation
And so what if it goes up on first day.........as an ignorant newbie.......I remember I made $1000 on the Virgin Blue float........now I cringe at my ignorance......knowing the risk of holding an airline stock, if only for a few days........if you like these odds, try blackjack itstead.......at least its completely tax deductible!!!
Your enthusiasm for stock investing is wonderful........it's reassuring that stocks will always have a romance, at least before you buy your first dog of a stock....
Seriously guys, have a look around and do your research......I'm sick of seeing the punters mercilessly fleeced by the Macquaire banks and private equity firms........
Even if Myer was sold off at half its listed price, it would not be a standout buy.........all the other analysis is just noise
If you actually want to make money, have a look at some of the other wonderful retailers trading on the stock market.......you can buy the cream on a similar valuation to Myer.........and you can buy better businesses than Myer for half the valuation
And so what if it goes up on first day.........as an ignorant newbie.......I remember I made $1000 on the Virgin Blue float........now I cringe at my ignorance......knowing the risk of holding an airline stock, if only for a few days........if you like these odds, try blackjack itstead.......at least its completely tax deductible!!!
