RAWS; "MHJ a buy when it holds $100m cash on the balance sheet."
its a worry what they are going to do with it. A big worry.
Originally Posted by winner69
Nothing worse than a company (with big egos?) with mountains of cash
Cash burns holes in ones pockets they say no doubt most of the $100m will be frittered away .wasted on some grandiose initiative.
I think we need to give the good people at MHJ a bit more credit.. Daniel Bracken (CEO) joined Nov 2018 and together with his buddy, Andrew Lowe (CFO) they have overseen a very prudent restructure of the company. They closed 27 stores and have been great custodians of the balance sheet taking borrowings from -$27m to a cash pile of $100m (ish) in this time. This is whilst navigating an unprecedented global pandemic.
They have worked very hard to build that war chest and I dont think they are going to spend it willy nilly on some grand acquisition. It doesnt fit the profile and historic actions of management.
I am guessing it is going to be a small bolt on acquisition in a new market that they can grow.
The cash pile is worth about 25 cents. remove that and MHJ is trading on 7.7 p/e. It is cheap and maybe it deserves to be given the cost of living crisis... maybe not.. people thought MHJ wouldnt sell any jewelry during the lock downs yet MHJ time after time surprised the market and produced amazing numbers. People now saying customers are only ever going to buy consumer staples.. MHJ will continue to sell trinkets folks.. you better believe it. There is always another birthday, engagement, anniversary, wedding and no matter how much Beagle tells you a can of baked beans from the WHS is the new gift for todays times.. I can promise you its not lol
In the DARK ages and some might say in parts of europe a new Dark age has reappeared; the Celts were busy as ever making trinkets and maybe in times of trouble people actually feel better wearing it!!!
One arts historian and commentator even decided that the Dark Ages were not so Dark because of the quality of the Jewellery being crafted.
hard to find hard data on this, but I recall hearing quite a bit about how the wedding industry is ramping back up now globally with a big surge due to many weddings having been delayed over the last couple of years now going ahead in 2022 & 2023. Can definitely see this in NZ & OZ as many waited until borders were reopened for overseas guests, and for local gathering limits to be removed.
I have no idea how much business jewelers get from wedding band sets (and engagement rings I guess), but I presume its substantial.
Last edited by LaserEyeKiwi; 03-05-2022 at 11:03 AM.
Originally Posted by Waltzing
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