The Lemon Fool

Dod101 wrote:I could never allow my self to sell Unilever simply because of its world class brands but at the same time we have been waiting for management to do a sort out for a long time. I think we need a statement of intent early in the New Year if not before to reassure investors that the new management is on to it.

Dod

I would expect the FY23 results to be poor, particularly given the issues with Hindustan. I’m sure they will start announcing disposals but would not be surprised to see a goodwill right off as the new CEO clears the decks for his tenure. He should be rubbing his hands together given how badly the company has been run for several years. There are so many easy gains to improve margins and reduce headcount. You just have to compare with P&G to see where Peltz and his mates could take things.

simoan wrote:

Dod101 wrote:I could never allow my self to sell Unilever simply because of its world class brands but at the same time we have been waiting for management to do a sort out for a long time. I think we need a statement of intent early in the New Year if not before to reassure investors that the new management is on to it.

Dod

I would expect the FY23 results to be poor, particularly given the issues with Hindustan. I’m sure they will start announcing disposals but would not be surprised to see a goodwill right off as the new CEO clears the decks for his tenure. He should be rubbing his hands together given how badly the company has been run for several years. There are so many easy gains to improve margins and reduce headcount. You just have to compare with P&G to see where Peltz and his mates could take things.

I am influenced not just by your evident enthusiasm but sheer pragmatism to buy some more at the current price. Proceeds will come from the tobaccos. This morning's Times has a lot on their underhand ways of promoting vaping amongst the young which I find disgusting,

Dod

Dod101 wrote:

simoan wrote:I would expect the FY23 results to be poor, particularly given the issues with Hindustan. I’m sure they will start announcing disposals but would not be surprised to see a goodwill right off as the new CEO clears the decks for his tenure. He should be rubbing his hands together given how badly the company has been run for several years. There are so many easy gains to improve margins and reduce headcount. You just have to compare with P&G to see where Peltz and his mates could take things.

I am influenced not just by your evident enthusiasm but sheer pragmatism to buy some more at the current price. Proceeds will come from the tobaccos. This morning's Times has a lot on their underhand ways of promoting vaping amongst the young which I find disgusting,

Dod

It’s not enthusiasm, it’s just experience. I expect there to be a better buying opportunity after the results next year, as they kitchen sink the last managements poor acquisitions. Having bought some sub £38 it would not surprise me if I can average down sub £36 in the spring. There’s no rush. If you don’t believe new management can get gross margin from 40% to something nearer P&Gs 50% and reduce operating costs, so more sales drop to the bottom line over the next couple of years it would be of no interest. Personally I prefer investments where the upside outweighs the downside on a medium term view.

simoan wrote:

Dod101 wrote:I could never allow my self to sell Unilever simply because of its world class brands but at the same time we have been waiting for management to do a sort out for a long time. I think we need a statement of intent early in the New Year if not before to reassure investors that the new management is on to it.

Dod

I would expect the FY23 results to be poor, particularly given the issues with Hindustan. I’m sure they will start announcing disposals but would not be surprised to see a goodwill right off as the new CEO clears the decks for his tenure. He should be rubbing his hands together given how badly the company has been run for several years. There are so many easy gains to improve margins and reduce headcount. You just have to compare with P&G to see where Peltz and his mates could take things.

That's my view as well regarding FY23 results..hence my "sitting on the touchline " comment.

Edit..Thank God HLN fell through!

simoan wrote:

Dod101 wrote:
I am influenced not just by your evident enthusiasm but sheer pragmatism to buy some more at the current price. Proceeds will come from the tobaccos. This morning's Times has a lot on their underhand ways of promoting vaping amongst the young which I find disgusting,

Dod

It’s not enthusiasm, it’s just experience. I expect there to be a better buying opportunity after the results next year, as they kitchen sink the last managements poor acquisitions. Having bought some sub £38 it would not surprise me if I can average down sub £36 in the spring. There’s no rush. If you don’t believe new management can get gross margin from 40% to something nearer P&Gs 50% and reduce operating costs, so more sales drop to the bottom line over the next couple of years it would be of no interest. Personally I prefer investments where the upside outweighs the downside on a medium term view.

Nobody wants to talk about Dollar Shave club (for example). It's way too embarrassing but fairly typical of the recent management, I would say.

Looks like Santa's decided we've been naughty this year and his flight has been diverted.

monabri wrote:Looks like Santa's decided we've been naughty this year and his flight has been diverted.

Last time I looked the rally was still intact for most of my shares.

Dod

Santa having a rest day today me thinks.

He did a heavy haul yesterday and Fridays tend to see a bit of a sell off end of day.

Despite todays "Red" its looking like another "Green" week. Ten minutes to go though .......

BullDog wrote:

simoan wrote:It’s not enthusiasm, it’s just experience. I expect there to be a better buying opportunity after the results next year, as they kitchen sink the last managements poor acquisitions. Having bought some sub £38 it would not surprise me if I can average down sub £36 in the spring. There’s no rush. If you don’t believe new management can get gross margin from 40% to something nearer P&Gs 50% and reduce operating costs, so more sales drop to the bottom line over the next couple of years it would be of no interest. Personally I prefer investments where the upside outweighs the downside on a medium term view.

Nobody wants to talk about Dollar Shave club (for example). It's way too embarrassing but fairly typical of the recent management, I would say.

That's in the past. Only the future matters now. There is a new external CEO and many of the other board positions have been made in the past 18 months, including a new Chairman, new CEO for Hindustan Unilever, and a very motivated NED in the shape of Nelson Peltz. There's no point just looking at the historic share price performance, the PER and complaining the dividend hasn't increased much - there has to be a catalyst for change and that's what the fresh management brings. If they were all internal promotions there'd likely be very little change and the situation would be different. It depends how you invest? I look at things very much from the business perspective and Unilever is a good business that has been very badly run for years. Therein lies an opportunity. We will see if the new management are able to cease it.

simoan wrote:

BullDog wrote:Nobody wants to talk about Dollar Shave club (for example). It's way too embarrassing but fairly typical of the recent management, I would say.

That's in the past. Only the future matters now. There is a new external CEO and many of the other board positions have been made in the past 18 months, including a new Chairman, new CEO for Hindustan Unilever, and a very motivated NED in the shape of Nelson Peltz. There's no point just looking at the historic share price performance, the PER and complaining the dividend hasn't increased much - there has to be a catalyst for change and that's what the fresh management brings. If they were all internal promotions there'd likely be very little change and the situation would be different. It depends how you invest? I look at things very much from the business perspective and Unilever is a good business that has been very badly run for years. Therein lies an opportunity. We will see if the new management are able to cease it.

I completely agree and I doubt very much that the new external appointees want to do other than improve things. Certainly the stage is set. Let's see what they have to say next year.

Dod

Dod101 wrote:

simoan wrote:That's in the past. Only the future matters now. There is a new external CEO and many of the other board positions have been made in the past 18 months, including a new Chairman, new CEO for Hindustan Unilever, and a very motivated NED in the shape of Nelson Peltz. There's no point just looking at the historic share price performance, the PER and complaining the dividend hasn't increased much - there has to be a catalyst for change and that's what the fresh management brings. If they were all internal promotions there'd likely be very little change and the situation would be different. It depends how you invest? I look at things very much from the business perspective and Unilever is a good business that has been very badly run for years. Therein lies an opportunity. We will see if the new management are able to cease it.

I completely agree and I doubt very much that the new external appointees want to do other than improve things. Certainly the stage is set. Let's see what they have to say next year.

Dod

Quite so, but clearly from the SP the market is still very sceptical.

Time will tell.

scrumpyjack wrote:

Dod101 wrote:
I completely agree and I doubt very much that the new external appointees want to do other than improve things. Certainly the stage is set. Let's see what they have to say next year.

Dod

Quite so, but clearly from the SP the market is still very sceptical.

Time will tell.

If you want to make money from investment, you have to go against the market more often than not, particularly if you want to beat the market. If you don't, buy a tracker. This idea of an efficient market in even large multinational companies is nonsense, and for smaller capitalisation companies it doesn't exist at all. Look at Meta and Intel this time last year - everyone hated them but not that much had really changed. Needless to say, Meta is my biggest winner this year - up 178% and Intel is up over 77%. I'm happily building a position in Paypal currently sub $60. Everyone hates it - great! It's still a very profitable company on a Non-GAAP PER of 12.

So, today we have some very good news on the new managements Growth Action Plan… unless you’re one of the 7,500 people losing their job, that is. This is not before time and makes very good strategic sense, particularly the spin off of the troublesome Ben & Jerrys with the rest of the ice cream business. The company needs to get much leaner, and as I have mentioned before improve its revenue per employee to something closer to P&G. It looks like all the ducks are starting to line up. It may take a while for this to show through in the share price, but that’s good, because it will enable me to build up a larger holding at an attractive long term valuation.

All the best, Si

Anyone any idea why I'm suddenly £7Kish better off on paper than yesterday? (Mostly FTSE100 constituents.) I really must have missed something in the news (but as I've been up a tall ladder all day that wouldn't surprise me). C.

csearle wrote:Anyone any idea why I'm suddenly £7Kish better off on paper than yesterday? (Mostly FTSE100 constituents.) I really must have missed something in the news (but as I've been up a tall ladder all day that wouldn't surprise me). C.

Interest rate outlook seems to have perked things up a bit today.

csearle wrote:Anyone any idea why I'm suddenly £7Kish better off on paper than yesterday? (Mostly FTSE100 constituents.) I really must have missed something in the news (but as I've been up a tall ladder all day that wouldn't surprise me). C.

I assume, rather than what the BOE had to say, that it was to do with last night (for us) Jerome Powell held his news conference, the market had been holding its breath for a week in the run up and then let out a huge breath when he didn't say anything too hawkish and did nothing to dispel the view of there being interest rate cuts forthcoming.

csearle wrote:Anyone any idea why I'm suddenly £7Kish better off on paper than yesterday? (Mostly FTSE100 constituents.) I really must have missed something in the news (but as I've been up a tall ladder all day that wouldn't surprise me). C.

My feeling is that MPC's inaction is the cause. They seem to be blind to the lack of significant change in the CPI and the possibly that we are likely to see the annual change close to zero come May. The index looks likely to fall well below the 2% target, in which case, what will they do?

I do not understand why they have not responded to the effective levelling off since May 2023.

TJH

csearle wrote:Anyone any idea why I'm suddenly £7Kish better off on paper than yesterday? (Mostly FTSE100 constituents.) I really must have missed something in the news (but as I've been up a tall ladder all day that wouldn't surprise me). C.

The US market was up big yesterday, and then again today as well. No particular news that I saw other than some benign remarks by the Federal Reserve chief, and in fact some bad news about Apple.

The UK generally takes its lead from the US markets.

Fun fact - for all the relative decline in the UK stockmarket, its market cap is still about 9% of global market cap ex-US. That makes it the biggest non-US stock market but for Japan at 15%. And ahead of France, Germany, Canada and China/Hong Kong.