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Unilever (ULVR)

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ADrunkenMarcus
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Re: Unilever (ULVR)

#473700

Postby ADrunkenMarcus » January 17th, 2022, 9:29 am

Unilever is still one of my largest individual company shareholdings and I’d expected a significant decline for my portfolio this morning, given that Unilever was down 7% or so. In fact it was flat because rises elsewhere made up for it - all the more pleasing as my DP Poland shares were also down 10%!

Best wishes


Mark

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Re: Unilever (ULVR)

#473701

Postby TheMotorcycleBoy » January 17th, 2022, 9:31 am

I think that today's drop is due to ULVR upping their offer

https://www.reuters.com/business/retail ... 022-01-16/

Which seems bonkers, don't some here already consider £50bn to be too much?

ULVR seem to suffering from poor management, their buyback campaign went no where (share price wise), they are missing out on alternative food developments, and attempting to overpay for assets others want to get rid of.

Matt

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Re: Unilever (ULVR)

#473705

Postby BullDog » January 17th, 2022, 9:43 am

TheMotorcycleBoy wrote:I think that today's drop is due to ULVR upping their offer

https://www.reuters.com/business/retail ... 022-01-16/

Which seems bonkers, don't some here already consider £50bn to be too much?

ULVR seem to suffering from poor management, their buyback campaign went no where (share price wise), they are missing out on alternative food developments, and attempting to overpay for assets others want to get rid of.

Matt

History is littered with hopeless management paying far too much for acquisitions that destroy value. Sometimes, the entire company is destroyed. Probably the most notable one for me being ICI. ICI was terribly mismanaged and when they acquired the fragrance and flavours division from (ironically) Unilever it paid far too much and it ultimately led the company to failure due to excess debt. The rump ICI of was taken over by Akzo Nobel in the end. By then, all that remained of ICI was really only Dulux paints. Billions of shareholder value and many thousand of jobs lost.

Eddit - Add Marconi (ex GEC) to the list of companies destroyed by acquisition.
Last edited by BullDog on January 17th, 2022, 9:44 am, edited 1 time in total.

simoan
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Re: Unilever (ULVR)

#473706

Postby simoan » January 17th, 2022, 9:43 am

TheMotorcycleBoy wrote:I think that today's drop is due to ULVR upping their offer

https://www.reuters.com/business/retail ... 022-01-16/

Which seems bonkers, don't some here already consider £50bn to be too much?

ULVR seem to suffering from poor management, their buyback campaign went no where (share price wise), they are missing out on alternative food developments, and attempting to overpay for assets others want to get rid of.

Matt

It’s difficult to tell whether the price is too much because we don’t know how much debt is included. We have to remember that the intention was for the GSK Consumer Healthcare business to be listed with 3.5x net debt/EBITDA.

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Re: Unilever (ULVR)

#473707

Postby 77ss » January 17th, 2022, 9:44 am

ADrunkenMarcus wrote:It’s rare but Unilever’s forward dividend yield is probably touching 4%.

Best wishes

Mark


Noted. Back when I first bought it (Jan 2011) the historic dividend was just 3.67%.

Terry Smith's onslaught amused me. Back in the day the fad was 'Corporate Mission Statements' (remember them?). We are now seeing 'Brand Mission Statements'!

I note, however, that he continues to hold - expressing confidence in the strength of the brands. Hmmm.

Unilever seems to need a regular kick in the pants - a la Kraft approach. The ludicrously tin-eared attempt to move the whole to Holland caused me to doubt the management quality. Polman may have gone, but Jope was part of the top team at the time.

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Re: Unilever (ULVR)

#473709

Postby BullDog » January 17th, 2022, 9:49 am

77ss wrote:
ADrunkenMarcus wrote:It’s rare but Unilever’s forward dividend yield is probably touching 4%.

Best wishes

Mark


Noted. Back when I first bought it (Jan 2011) the historic dividend was just 3.67%.

Terry Smith's onslaught amused me. Back in the day the fad was 'Corporate Mission Statements' (remember them?). We are now seeing 'Brand Mission Statements'!

I note, however, that he continues to hold - expressing confidence in the strength of the brands. Hmmm.

Unilever seems to need a regular kick in the pants - a la Kraft approach. The ludicrously tin-eared attempt to move the whole to Holland caused me to doubt the management quality. Polman may have gone, but Jope was part of the top team at the time.

Latest in a long line of corporate no hopers. They think that they "have to something" when usually the best course of action is doing nothing. Sadly, GSK is another prime example of inept senior management.

simoan
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Re: Unilever (ULVR)

#473711

Postby simoan » January 17th, 2022, 9:55 am

77ss wrote:Terry Smith's onslaught amused me. Back in the day the fad was 'Corporate Mission Statements' (remember them?). We are now seeing 'Brand Mission Statements'!

I note, however, that he continues to hold - expressing confidence in the strength of the brands. Hmmm.

I bet he doesn’t now! High probability that was him rushing through the out door this AM on this weekend’s news.

All the best, Si

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Re: Unilever (ULVR)

#473714

Postby Dod101 » January 17th, 2022, 10:08 am

I do not really understand the very negative comments on Unilever. Time was not so long ago that they were held up as the sort of company that should be included in every HYP for instance, to provide some ballast. There is no doubt that every big acquisition is a risk. both in terms of paying too much for it and also in the execution, but life and business are always a risk.

How does anyone know if £50 billion or £55 billion is too much for the healthcare division of Glaxo or not? I certainly do not know and nor do I know if Unilever can make a great success of it or not.

Anyway currently, to compensate for the drop in the Unilever price we have a nice uplift in the price of Glaxo.

Dod

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Re: Unilever (ULVR)

#473723

Postby simoan » January 17th, 2022, 10:24 am

Dod101 wrote:I do not really understand the very negative comments on Unilever. Time was not so long ago that they were held up as the sort of company that should be included in every HYP for instance, to provide some ballast. There is no doubt that every big acquisition is a risk. both in terms of paying too much for it and also in the execution, but life and business are always a risk.

But many of us are not discussing it from a HYP perspective. We're not in that forum and so here we can discuss important things like debt levels, valuation as multiples of Sales and EBITDA, operating margins, and most importantly, the competence of Unilever management.

Dod101 wrote:Anyway currently, to compensate for the drop in the Unilever price we have a nice uplift in the price of Glaxo.

Bit short termist for a HYP'er dontcha think? One dividend yield grows the other shrinks :)

All the best, Si

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Re: Unilever (ULVR)

#473733

Postby Dod101 » January 17th, 2022, 10:42 am

simoan wrote:
Dod101 wrote:I do not really understand the very negative comments on Unilever. Time was not so long ago that they were held up as the sort of company that should be included in every HYP for instance, to provide some ballast. There is no doubt that every big acquisition is a risk. both in terms of paying too much for it and also in the execution, but life and business are always a risk.

But many of us are not discussing it from a HYP perspective. We're not in that forum and so here we can discuss important things like debt levels, valuation as multiples of Sales and EBITDA, operating margins, and most importantly, the competence of Unilever management.

Dod101 wrote:Anyway currently, to compensate for the drop in the Unilever price we have a nice uplift in the price of Glaxo.

Bit short termist for a HYP'er dontcha think? One dividend yield grows the other shrinks :)

All the best, Si


Well I am not a HYPer but both Unilever and Glaxo are commonly held in HYPs and at least a number of those commenting here are common names on the HYP Board.

For what it is worth I know that it could certainly be said that the Unilever management has gone off the boil but Unilever, like most shares, has periods when it does well and then not so well depending on economic realities. Covid has upset a lot of plans and so will inflation so it is a bit difficult to say how Unilever is coping. Their culture is right and at times they could be said to be rather too conservative for their own good so I think that a tilt at the Glaxo healthcare division is surely a good thing. They know a lot more about their markets and its prospects than I do.

As for being short termist, of course my comment is. It was intended to be no more than a flippant comment because of course the position could reverse by tomorrow morning. It was never intended to be a serious comment.

Dod

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Re: Unilever (ULVR)

#473761

Postby SalvorHardin » January 17th, 2022, 11:41 am

Dod101 wrote:Well I am not a HYPer but both Unilever and Glaxo are commonly held in HYPs and at least a number of those commenting here are common names on the HYP Board.

For what it is worth I know that it could certainly be said that the Unilever management has gone off the boil but Unilever, like most shares, has periods when it does well and then not so well depending on economic realities. Covid has upset a lot of plans and so will inflation so it is a bit difficult to say how Unilever is coping. Their culture is right and at times they could be said to be rather too conservative for their own good so I think that a tilt at the Glaxo healthcare division is surely a good thing. They know a lot more about their markets and its prospects than I do.

If Unilever's share price keeps falling we'll soon be at a point where Unilever's yield qualifies for HYP under the standard HYP criteria :D

Management has taken its eye off the ball in recent years, with lots of attention being paid to politics and virtue signalling thus distracting senior management from actually running the business. The debacle of the proposed move to Rotterdam, which amongst other things would have imposed Dutch withholding tax on non-Dutch shareholders, caused the the last CEO (Polman) to resign.

Unilever is talking about the higher purpose of Hellmann's; all I can say is WTF, it's mayonnaise and I put it on salad, sandwiches and chips and don't want a serving of politics or to be lectured about it. And I'm not the only one. Go woke, go broke.

How come Procter & Gamble and Nestle's share prices have done noticeably better in the last few years? They're very similar businesses.

Ben & Jerry's boycott of Israel has meant that institutions in thirty-five American states have had to sell their Unilever shares and bonds, because of laws against boycotting Israel. Quite a lot of people are now boycotting not only Ben & Jerry's, but all Unilever goods. A good start would be to sell Ben & Jerry's ASAP.

That said, Unilever definitely meets Warren Buffett's principle: "I try to invest in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will"

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Re: Unilever (ULVR)

#473766

Postby monabri » January 17th, 2022, 12:10 pm

simoan wrote:
77ss wrote:Terry Smith's onslaught amused me. Back in the day the fad was 'Corporate Mission Statements' (remember them?). We are now seeing 'Brand Mission Statements'!

I note, however, that he continues to hold - expressing confidence in the strength of the brands. Hmmm.

I bet he doesn’t now! High probability that was him rushing through the out door this AM on this weekend’s news.

All the best, Si


Not too worried about Smith exiting, he holds <1% of ULVR. BlackRock hold 11x more.....

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Re: Unilever (ULVR)

#473791

Postby Dod101 » January 17th, 2022, 1:01 pm

SalvorHardin wrote:
Dod101 wrote:Well I am not a HYPer but both Unilever and Glaxo are commonly held in HYPs and at least a number of those commenting here are common names on the HYP Board.

For what it is worth I know that it could certainly be said that the Unilever management has gone off the boil but Unilever, like most shares, has periods when it does well and then not so well depending on economic realities. Covid has upset a lot of plans and so will inflation so it is a bit difficult to say how Unilever is coping. Their culture is right and at times they could be said to be rather too conservative for their own good so I think that a tilt at the Glaxo healthcare division is surely a good thing. They know a lot more about their markets and its prospects than I do.

If Unilever's share price keeps falling we'll soon be at a point where Unilever's yield qualifies for HYP under the standard HYP criteria :D

Management has taken its eye off the ball in recent years, with lots of attention being paid to politics and virtue signalling thus distracting senior management from actually running the business. The debacle of the proposed move to Rotterdam, which amongst other things would have imposed Dutch withholding tax on non-Dutch shareholders, caused the the last CEO (Polman) to resign.

Unilever is talking about the higher purpose of Hellmann's; all I can say is WTF, it's mayonnaise and I put it on salad, sandwiches and chips and don't want a serving of politics or to be lectured about it. And I'm not the only one. Go woke, go broke.

How come Procter & Gamble and Nestle's share prices have done noticeably better in the last few years? They're very similar businesses.

Ben & Jerry's boycott of Israel has meant that institutions in thirty-five American states have had to sell their Unilever shares and bonds, because of laws against boycotting Israel. Quite a lot of people are now boycotting not only Ben & Jerry's, but all Unilever goods. A good start would be to sell Ben & Jerry's ASAP.

That said, Unilever definitely meets Warren Buffett's principle: "I try to invest in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will"


I too prefer businesses that put their business first and that means being responsible to their shareholders as a priority. OTOH I have come to the conclusion that adhering to ESG principles is no bad thing but Unilever seems to have gone overboard the other way, in areas that I cannot understand such as all this nonsense about Hellmanns. I did not appreciate the consequences of the Ben and Jerry's actions. Presumably that in itself would help to explain the weakness in the share price. I cannot anyway understand the logic of owning a business where you cannot control what its Board decides.

Dod

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Re: Unilever (ULVR)

#473801

Postby monabri » January 17th, 2022, 1:27 pm

Flying close under the radar

viewtopic.php?p=469740#p469740

Johnson & Johnson

"The New Consumer Health Company would be a leading global consumer health company, touching the lives of over one billion consumers around the world every day through iconic brands such as Neutrogena, AVEENO®, Tylenol®, Listerine®, JOHNSON’s®, and BAND-AID® and continuing its legacy of innovation. The New Consumer Health Company’s Board of Directors and executive leadership would be determined and announced in due course as the planned separation process progresses."

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Re: Unilever (ULVR)

#473828

Postby scrumpyjack » January 17th, 2022, 2:56 pm

It seems quite possible that Unilever's ill judged (in my view anyway) attempt to buy Glaxo's healthcare business at a price that risks sinking Unilever, could well trigger another bid for Unilever! Particularly as such a bid is easier now they are not a Dutch company.

I would prefer that to happen than for their acquisition to go ahead.

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Re: Unilever (ULVR)

#473856

Postby ADrunkenMarcus » January 17th, 2022, 4:18 pm

:cry:

I would be sad to see Unilever go, even at a considerable premium.

Best wishes

Mark

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Re: Unilever (ULVR)

#473866

Postby Dod101 » January 17th, 2022, 5:09 pm

scrumpyjack wrote:It seems quite possible that Unilever's ill judged (in my view anyway) attempt to buy Glaxo's healthcare business at a price that risks sinking Unilever, could well trigger another bid for Unilever! Particularly as such a bid is easier now they are not a Dutch company.

I would prefer that to happen than for their acquisition to go ahead.


Personally I cannot judge whether the bid is in the interests of Unilever and its shareholders or not. Certainly it is undoubtedly a gamble but then so are a lot of business decisions. Many a company has come to grief through a big acquisition, usually through overpaying, though. But I would not want to see Unilever being bid for although some may even as I write be running their slide rule over Unilever. It has closed today at £36.65.

Dod

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Re: Unilever (ULVR)

#473871

Postby Lootman » January 17th, 2022, 5:21 pm

ADrunkenMarcus wrote::cry:

I would be sad to see Unilever go, even at a considerable premium.

There aren't too many companies big enough that could buy it and I imagine that you would probably end up with shares in a similar company like P&G, Nestles, Colgate Palmolive. Pepsi, Mondelez.

It's probably not cheap enough for Buffett or a private equity deal.

I sold my Unilever a few months ago so would not be well pleased if it got a takeover bid.

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Re: Unilever (ULVR)

#473872

Postby scrumpyjack » January 17th, 2022, 5:24 pm

Dod101 wrote:
scrumpyjack wrote:It seems quite possible that Unilever's ill judged (in my view anyway) attempt to buy Glaxo's healthcare business at a price that risks sinking Unilever, could well trigger another bid for Unilever! Particularly as such a bid is easier now they are not a Dutch company.

I would prefer that to happen than for their acquisition to go ahead.


Personally I cannot judge whether the bid is in the interests of Unilever and its shareholders or not. Certainly it is undoubtedly a gamble but then so are a lot of business decisions. Many a company has come to grief through a big acquisition, usually through overpaying, though. But I would not want to see Unilever being bid for although some may even as I write be running their slide rule over Unilever. It has closed today at £36.65.

Dod


I too would prefer that Unilever continue independent and regain its former levels of profitability and growth. But if they do eventually pay £60 billion, of which 50 is cash and 10 shares issued at a depressed price, I would prefer that another company stops that happening by buying them. The alternative is a serious danger of a business ruining itself at huge cost to the shareholders who own it. Today's share price drop shows that Mr Market is worried too!

I would be interested to hear what Terry Smith and Nick Train think of what is happening.

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Re: Unilever (ULVR)

#473897

Postby monabri » January 17th, 2022, 8:00 pm

Looking at the timing of this...

- Smith's comments regarding ULVR in the papers late on Friday and over the weekend.
- Weekend news that ULVR made several bids for GSK H'Care - all rejected.
- US markets closed today - folk on holiday (Martin Luther King Jr day)

Maybe Smith was actually looking to top up ULVR and today might have been a good day to do so. Did Smith have an insight into ULVR's failed attempts?

Too many significant announcements in one weekend!


:?:


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