MHJ - Michael Hill International.

[JohnnyTheHorse]

Absolutely MASSIVE trading update.

30-40% pcp EBIT growth. 150-250bps margin expansion. Dividend finally being distributed.

Look at the financials and you'll see this is in for a serious re-rating. If they can sustain this then Spheria's expectation of $1.50-2.00 isn't unrealistic. I see this easily in the $0.90-1.00 range in the short term (unless ACC keeps trimming).

Disc: hold.

[JohnnyTheHorse]

The 1.4m shorts on the ASX might feel a bit of pressure today!

[Rawz]

This is an amazing trading update and includes periods of store closures (28 Melbourne stores reopened late Oct, 9 other Aussie stores closed for a short period and 21 Canadian stores closed since Nov).

The online sales growth is huge and margins will only get better with this growth. They possibly don't have anymore non performing stores as no stores were permanently closed. Inflection point???

This is heading to $1.

[winner69]

“Amazing”, “great”, “excellent”, “absolutely MASSIVE” and another ‘amazing’ so update must have been pretty good.

Not good stuff all sales growth in NZ ...and strange that Q2 appears to have been weaker than Q1 in NZ

Never mind it’s the HEADLINES that matter ....no need to look at the detail as knowledge is superfluous in acrosring bull market.

[Lease]

I have to admit MHJ have not disappointed me.

[Rawz]

“Amazing”, “great”, “excellent”, “absolutely MASSIVE” and another ‘amazing’ so update must have been pretty good.

Not good stuff all sales growth in NZ ...and strange that Q2 appears to have been weaker than Q1 in NZ

Never mind it’s the HEADLINES that matter ....no need to look at the detail as knowledge is superfluous in acrosring bull market.

NZ same store grew 2.8% FY21H1. Not "amazing" but when margin increases 150-250bp it is AMAZING . I'm sure some heavy discounting promo's would have seen higher same store sales but eroded margins..

NZ Q2 sales 44m (same store)
NZ H1 sales 68.4
= NZ Q1 sales 24m?

[nztx]

Good to see MHJ finally come clean & cut loose the deferred previously deferred March 2020 Div they put the stops on..

about time too after their posturing on better recent trading in past weeks ..

Probably wouldn't consider buying these again .. far better fish to fry elsewhere ..

[winner69]

The details in the devil they say and I've updated a model I had i couple of years ago before I gave up on them.

Today's announcement - narrative is good but the numbers aren't that good. OK, there's extenuating circumstances like covid stuff and they say they are still in turn around mode but its hardly an inspiring story

I reckon that even at current share price there's still a lot of hope of things coming right

In nztx camp ..... put it this way even if MHJ share price doubles others will have more than doubled.

[clearasmud]

The details in the devil they say and I've updated a model I had i couple of years ago before I gave up on them.

Today's announcement - narrative is good but the numbers aren't that good. OK, there's extenuating circumstances like covid stuff and they say they are still in turn around mode but its hardly an inspiring story

I reckon that even at current share price there's still a lot of hope of things coming right

In nztx camp ..... put it this way even if MHJ share price doubles others will have more than doubled.

What your model saying in regards to free cash flow or net profit? Thanks.

[winner69]

What your model saying in regards to free cash flow or net profit? Thanks.

DCF comes in about 50 cents ....... extremely bullish case about 70 cents (hence my comment about heaps of hope built into share price)

Yes these are turbulent times and MHJ could go anywhere.

I think H1 sales are really disappointing. There's been no catch up on the so called $80m of lost sales in H220 - other retailers have all had a decent amount of catch up)

But essentially I just can't see enough in the outlook to justify the current share price when its book value is about 40 cents