I am not familiar with the Trustpilot website so I checked out a few other well known brands on it. Many are voted worse than Worldstores. Perhaps the site is used more by disgruntled customers than satisfied ones. If the statistical sample is biased then the results are questionable. That said, Dunelm comes out very well.
To argue that the fall in shares is attributable to the trustpilot survey is, in my opinion, weak, since there has been no noticeable deterioration in the comments; they were receiving bad ones at the start of the survey in 2009.
Class act. Can't fault this. Strong headline t/o growth. Clearly dominating the market sector (ie better than John Lewis). Margin dilution essentially a handful of one offs as largely integration of WS acquisition + aggressive rollout leads to a series of step changes in investment. These will unwind h2 & along with a lull in rollout will lead to a significant recovery in margin & especially cash generation. Key issue is the potential store footprint. Original target 200 st looks light to me in context of UK retail. Is it 250 st as the previous CEO commented? If it's split the diff, say 225 st, which I think it's quite feasible, then DUN looks outrageous to me, with an exit to private equity ca 5 years down the road.
Been in this one since more or less the get go & I think I'll be around quite a while yet. As ever more or less ignored by the city (?!), which will throw up buying opportunities.
Jefferies is backing strong online businesses like Boohoo (BOO) in 2018 as consumers continue to spend cautiously this year.
Analyst Caroline Gulliver retained her buy recommendation and share price target of 280p saying the online fashion retailer had consistently beaten high sales growth expectations and expected it to continue to do so.
The shares climbed nearly 9p or 4.7% to 197.3p.
2018 could be another tough year Inflation is expected to ease into the second half of 2018, which should provide some relief. However, with real GDP growth expected to slow, ongoing Brexit negotiations and rising interest rates, we think consumers will spend prudently in 2018, she said.
In light of this, in the UK we have preference for discounters like B&M who are well positioned for any weakness in the consumer environment, strong online retailers like Boohoo, retailers with compelling self-help stories like M&S and Kingfisher, or retailers with strong brand equity like Ted Baker.
Gulliver told investors to avoid cyclically-leveraged retailers like Dunelm, or operationally challenged retailers like Sports Direct.
(ShareCast News) - Dunelm shares were boosted by a note from Deutsche Bank on Friday, anticipating an upbeat update next month covering the Christmas period.
Deutsche upped its share price target for Dunelm to 685p from 640p, with its recommendation remaining 'hold' following a challenging 12 months but where like-for-like sales and space expansion have recently accelerated and the integration of acquired online business WorldStores appears to be performing on track.
Looking forward to the homewares retailer's post-festive update in January, analysts forecast a solid performance due to modest comparatives and from faster online growth due to the added WorldStores ranges.
LFL sales are predicted to be up 2% and total sales 12.9%, including £15m perimeter effect of consolidating the final two months of WorldStores.
With slightly more optimistic second and third quarter sales assumptions, analysts increased forecasts 3%, implying Dunelm trades on 13 calender 2018 P/E ratio with a 7% free cash flow yield.
DB retiatered 'buy' ratings for Associated British Foods, B&M European Value and Boohoo as its top picks in the non-food retail sector.
IMV the Worldstores offering will make the difference going forward.
Dunelm are succeeding as they offer choice, quality and good value. Ours is always busy, even though they are competing locally with B&M x 2, and Home Bargains. You want skandi, they've got it, traditional, got that. Ready to hang curtains, or made to measure, got those as well. Funky lighting fills the gap left by BHS, the prices are not silly as in Next Home and M&S Home, and the kitchenware and tableware ranges last a few years so you can top up. For me, as a keen value shopper (and value share trader) this appears under-valued at present relative to good potential for upside.Go into a shop and see for yourself!
Dunelm & some other retailers are downstream from housing. They start as being a royalty on housing transactions. Though aggregate housing transactions are flat lining, new builds largely being sold to FTBs are racing away with construction/sales rising exponentially. Of course FTBs need to fill their new build homes with 'stuff' (a highly technical term). How many homes do you know that don't have towels, crockery, bedding, sofas etc etc etc etc???? So - Dunelm, purveyors of fine Stuff to the gentry.
They have just opened a new Dunhelm in warrington - replacing an old run down building by the railway tracks - bigger shop with much improved offerings in a really nice environment and a cafe - on a retail park just off the M62 - i can't set it failing to increase sales.
Jefferies do seem way too low with their price target even compared with others so your post has lots of merit although them highlighting the price recovery over it's peers holds some truth to me. Will be interesting to see over the Xmas period how retail & DNLM perform.
06 Dec 17 Jefferies International Underperform 717.50 515.00 560.00 Retains
05 Dec 17 Peel Hunt Hold 717.50 620.00 620.00 Retains
18 Oct 17 Barclays Capital Overweight 717.50 - 860.00 Reiterates
13 Oct 17 JP Morgan Cazenove Overweight 717.50 760.00 760.00 Reiterates
12 Oct 17 Deutsche Bank Hold 717.50 630.00 640.00 Retains
I cannot agree with Jeffries opinions as they are way out of touch with what is happening under the revised management's operations which do not appear to known to these "analysts ". This has happened previously and I am left wondering just where they get such incorrect wild guesses from and who do think would pay any attention to them.
Jefferies believes the rally in Dunelm (DNLM) shares is overdone and it will struggle to grow enough to meet expectations. Analyst Caroline Gulliver retained her underperform recommendation but increased the target price from 515p to 560p. The shares fell 4.5p to 705p esterday.
We believe the 28% increase in Dunelms share price 22% versus the sector over the past five months is overdone as we estimate that for Dunelm to reach its market share ambitions it would require a 7.5% like-for-like for eight years, she said.
Without investment in margins, this seems a stretch to us given competitive pressures from discounters and other retailers with a higher net promoter score [a measure of customer loyalty]. Hence, with our full year 2018-19 forecasts 8-9% below consensus, we maintain an underperform.
Plans from homeware retailer Dunelm (DNLM) to double sales in the medium term are overly ambitious given the economic environment, according to Jefferies.
Analyst Caroline Gulliver retained her underperform recommendation and target price of 515p on the shares, which fell 3p to 639p yesterday.
Last week Dunelm raised its medium term sales ambition to £2 billion, double full-year 2017 sales, she said.
We estimate that to do this within eight years would require a like-for-like of 7.5%, which we view as overly ambitious given the weak macro-environment and competitive pressure from Amazon and other retailers with a higher net promoter score [that measures customer loyalty] than Dunelm.
Gulliver added that her full-year 2018 and 2019 forecasts were 8-9% below consensus and thus we retain an underperform.
Clarity on leadership would provide a platform for Dunelm (DNLM) shares following chief executive John Browetts shock departure last month, says Peel Hunt.
Analyst John Stevenson retained his hold recommendation and target price of 620p on the stock after final results showed profit before tax fell 15% year-on-year as expected. The drop was a function of expected Worldstore losses.
The shares jumped 5% to 645.3p yesterday.
Theres not much in the way of new information [in the results], no bad thing given the recent departure of the chief executive, said Stevenson.
Trading on c.13x price/earnings ratio, clarity on leadership would provide a platform for the shares to build from.
He added that trading was positive and the outlook for the shares and the business should be much clearer from here.
Good comments at last coming now. There is a real buzz not only in the stores where we can go and see for ourselves as some posters have been doing recently but the admin has been well and truly shaken up as well.
We should have realised something was happening when the late (but not lamented) CEO departed recently -but made further £10k share to swell his already significant holding in DNLM. Now why would he do that just before the announcement of his departure? He obviously knew the group was on the move as he was in a position to see the wood for the trees as one poster here described what perhaps he saw as stagnation at that time.
Don't laugh when some folks point out that we will never see the £10 and upwards price ever again. For example, we have not seen what helpful results can add when the World Stores becomes a paying concern as promised. They didn't buy two loss-making companies for fun!
The results were pretty much known IOM. I think the market's concentrating on the ...
"Sales in the first two months of the new financial year have started positively, with good LFL sales boosted by favourable weather comparatives. We expect to open 8 new stores in the first half of the year of which 4 are already open. An encouraging start"
... bit in the Outlook section, with the focus on LFL sales.
In there yesterday, and the furry blankets and fleecy feet-warmers are flying off the shelves. They even have a furry GOT-style scarf at £14. These will be a fantastic hit with customers. I am convinced they know their market very well.
While it is usually disconcerting when a CEO leaves suddenly, this is not the case here as the company already stated that his appointment was subject to a six month trial period during which Will Adderley himself would oversee the company's progress.
With share price having been so disappointing, I suspect that the board have been embarrassed to the extent that perhaps Mr Browett would be better to seek a change of challenge elsewhere as he claims.
There have been a number of necessary changes in the way the company operates internally and some senior staff have been concerned that these changes have not been taking place quickly enough.
It is not known if Mtr. Browett was invited to depart but some staff may now be breathing a sigh of relief so this announcement might not be anything to be concerned about for investors.
There may be more behind this. "For personal reasons" seems to be in conflict with the phrase " however the next phase of growth requires different leadership".
The timing, 2 weeks before results is suspicious. It is sudden, given DNLM have no replacement lined up and John Browett does not appear to have a position to go to, just wishing "to move on to the next chaallenge". I would have thought there was still a big enough challenge at DNLM, given the poor stock valuation.
Good post Smarter. All your observations are 100% correct. Both Next and Homebase look lifeless - the latter particularly so and many staff have already departed. In one store there was only one person at seven checkouts!.
On the other hand here is a real buzz at Dunelm sites and they have had to upgrade all their tills to new faster and more checkouts to avoid waiting times.
They have also set up new qjuicker and clever procedures for stock control to makes sure there are very few gaps on the shelves and to speed up correct refills from their warehouses.
Surely a very clear sign that they are adapting to customer demands?
Like most of us, I am down 50% on my investment but I m certain that even with all the gloomy news and blaming Brexit etc, this is a stonking buy for a Group which is top of the Retail trade in their sector - even above the much respected John Lewis so I am staying in for the long haul!
Hope they're in the shop buying and not just using the car park. Must check out Exeter store again soon... have liked Dunelm from my first visit and parents (neither keen shoppers) also rate the store and prices.
Our local retail park is probably typical with a Dunelm, Next Home and Homebase in one place. Homebase is rapidly going downhill. The new Aussie owners have taken it way downmarket so that a Poundstretcher or B&M Bargains shop look like palaces by comparison. Hand-written signs and messy piles of 'bargains' proliferate. The Laura Ashley unit was taken out. Management decided to bung in some winter fireplace stock. The LA fitments all remain in place along with sections of wallpaper. The whole effect is bizarre and unsettling to a shopper. Staff seem gloomy. Tragedy for sales is sure to ensue. Next Home is as dead as a doornail. Anything other than bath towels seems very pricey. Footfall seems virtually non-existent. Staff invisible. It is all very tidy but lifeless, a showroom where there is nothing to take away today except expensive nicknackery and linens. Argos must be hammering them. Now we come to Dunelm, which is buzzing with activity and shoppers. The prices have certainly increased from recent years, but there are interesting on-trend new products on offer, the cafe is thronging and the tills are ringing. Staff are jolly and helpful. I for one am confident that Dunelm has turned a corner and we'll see the results by Christmas.
Dunelm Group plc (the "Company") has been notified of the following dealing by its Chief Executive John Browett in its ordinary shares of 1p each:
Name of Director Date of No of shares Price per
/ person closely purchase share
------------------- ----------- ------------- ----------
John Browett, 12 July
Chief Executive 2017 9,098 546.5p
555 today, which could act as support. The more pessimistic broker views seem to be holding the day. Volume on the drop since April has been consistently high suggesting the bearish case is very well supported. If 555 doesn't hold as support (I'm looking at the weekly chart so closing prices at close of play on each friday are the important thing), then 525 seems to be likely, if that fails, then 478 and 454 come into play. Never say never!
Possibly more positively there's is a good bullish divergence of price vs 1433 Stoch and RSI building on the weekly chart, these divergences often lead into a jump in price, the quetion is when and from where.
At the current time, technically speaking DNLM is very bearish I'd say and the volume on the selling is not diminishing on any time frame.
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