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[g4ry13]

photosnob said:

g4ry13 said:

I got rid of iii - used to be good, now they're not. No reason to be paying that quarterly fee so I transferred everything out of iii and told them where to go.

I'm with Hargreaves Lansdown now. No quarterly fee, pretty low costs and they're actually rather reasonable in terms of customer service. I complained around the time of Royal Mail IPO and they refunded me some money rather than telling me to sod off.

Does it cost much to switch? At the moment I am fine with the share centre - but I don't want to be paying those sort of fees every time I buy shares. Not do I really want to be paying a monthly or quarterly fee for shares that might be left there for years.

I paid nothing to switch from iii to HL. It's just a case of getting one broker to transfer to another. I wasn't buying shares often, but an extra £80 to hold investments seemed wasteful. Especially considering when I originally got the account it was on the premise there was no monthly charge.

[g4ry13]

g4ry13 said:

paulrussell said:

I've been buying Tesco shares every 4 weeks for 9 years now, and I get shares as my bonus . Tesco buys them for me out of my pay since I work for them. The highest I paid for shares is £4.86, so that shows just how much the share price has gone down by. Hopefully Dave Lewis can turn Tesco around, but I'm a bit sceptical about his lack of retail experience. Mike Ashley must be convinced about Tesco being able to turn itself around, as according to a newspaper I read he placed a £43 million bet on Tesco being turned around.

Mike Ashley loves a flutter. Reports vary but he allegedly put down £800k/point on HBOS when he was spread betting. I've read that he lost between £129-300 million of his own money.

I'd take more comfort in the Oracle of Omaha though as he rarely makes bad bets.

oops not a day after saying that the story comes out.

"Legendary investor Warren Buffett has said he made a “huge mistake” by investing in Tesco, as the problems mount at Britain’s largest retailer."

I have the midas touch, a really strange thing for him to come out with so soon after his Tesco investmnent considering he's the long term investment guy.

[johnfm]

g4ry13 said:

g4ry13 said:

paulrussell said:

I've been buying Tesco shares every 4 weeks for 9 years now, and I get shares as my bonus . Tesco buys them for me out of my pay since I work for them. The highest I paid for shares is £4.86, so that shows just how much the share price has gone down by. Hopefully Dave Lewis can turn Tesco around, but I'm a bit sceptical about his lack of retail experience. Mike Ashley must be convinced about Tesco being able to turn itself around, as according to a newspaper I read he placed a £43 million bet on Tesco being turned around.

Mike Ashley loves a flutter. Reports vary but he allegedly put down £800k/point on HBOS when he was spread betting. I've read that he lost between £129-300 million of his own money.

I'd take more comfort in the Oracle of Omaha though as he rarely makes bad bets.

oops not a day after saying that the story comes out.

"Legendary investor Warren Buffett has said he made a “huge mistake” by investing in Tesco, as the problems mount at Britain’s largest retailer."

I have the midas touch, a really strange thing for him to come out with so soon after his Tesco investmnent considering he's the long term investment guy.

Terry Smith's analysis of why Tesco was always a crap buy is very good.

[DSLiverpool]

Every one here would have bought Tesco at £1.75 6 months ago, I think its a good long termer (3 years+) and have bought in. Its too big to fail all that's wrong is weak leadership and over confidence.

[walm]

DSLiverpool said:

Every one here would have bought Tesco at £1.75 6 months ago, I think its a good long termer (3 years+) and have bought in. Its too big to fail all that's wrong is weak leadership and over confidence.

I have no view on the stock price but I am afraid that "weak leadership" and "over confidence" (whatever that is)... shows a very poor grasp of the facts.

Hard discounters are taking share like crazy.
They have committed to double their store base by 2020-22.
Aldi just did 30% LFL growth in 2013.

So ANY growth in the very slow growing grocery market is absorbed by these guys.

Other categories that are growing are convenience and online.
Tesco has both of these but the returns for this type of retailing are fundamentally lower than regular big box supermarkets.
Volumes are DECLINING at the big boxes but Tesco CANNOT downsize owing to LT leases (20yr+).
Most other costs are inflating too.
So sales down and costs up = declining margin.

For a few years the declining volumes were offset by rising prices and margins were sustained.
However, that can only go on so long.
ASDA effectively broke ranks and initiated a price war between the big 4.
We are right in the middle of that right now.
There is simply no end in sight.

The big 4 cannot compete with the discounters on price - if they did the wafer thin margins would be zero or negative.

The outstanding question is how far prices at the big 4 have to drop in order to stem the volume decline.
No one knows.

BUT my point is that to be honest this wasn't particularly Tesco's fault.
Perhaps they could have launched their own discount store (SBRY are trying that now) - but they are so big it would cause huge cannibalisation problems.
They attempted to stem the tide of the discounters by suring up huge landbanks to prevent new stores from Aldi+Lidl but again - the planners eventually got wise.

It is just a very very tough situation.

[Shnozz]

To those more educated than myself (all of you..), can anyone give a precis of the real estate position on Tesco? Is their property portfolio sufficiently strong to underpin the market cap at a particular price point?

[walm]

Shnozz said:

To those more educated than myself (all of you..), can anyone give a precis of the real estate position on Tesco? Is their property portfolio sufficiently strong to underpin the market cap at a particular price point?

This is perhaps over-simplified but I simply don't buy the idea that real-estate ownership (or not) makes much difference to the supermarkets.

Here's why:
The value of that real-estate is fundamentally linked to the profitability of the supermarket using it.
It is usually impossible to re-zone it such that you can put a Next/Currys on it.
In any case they are trying to downsize too.
The other candidates are the DIY guys... guess what - ALSO downsizing.

Essentially pretty much ALL of retail is over-spaced on big boxes.

So again, the value of that box is how much profit a supermarket can make on it.
And no one knows how bad that could get.

Nevertheless you WILL get rampant speculation on someone potentially buying TSCO or MRW and splitting them opco/propco - I haven't done the math at what price point but it's certainly already happening with MRW.

The issue is that private equity simply isn't that dumb! Why buy land today with your only potential tenant seeing margins in free-fall.
Wait until the whole thing stabilises first. (If ever!)

[DSLiverpool]

[quote=walm] Very insightful stuff
[quote]
Yes I see the Armageddon scenario and think they will have to buy a competitor to overcome the malaise but I feel regardless of woes its undervalued right now and simplistically I see a short term correction and a long term calculated gamble - its all guesswork but some guess better than others.

[walm]

Thanks and as I said, no view on the stock.
It is certainly astonishingly beaten down and with probably the worst sentiment of almost anything I have ever seen.

Last point: http://en.wikipedia.org/wiki/Herfindahl_index

It's gonna be tough for them to buy any of the big 4.

[DSLiverpool]

walm said:

probably the worst sentiment of almost anything I have ever seen.

.

Ahem Balfour Beattie

[GTIR]

It's funny how all these experts are coming up with all these facts and views on Tesco and how crap they are. Only time will tell.

I remember when Tesco were crap in the early 90's and they are the granddaddy of the large supermarket. I'm pretty sure they will return.

I hope so!

[twinturboz]

Bit of chatter going round that Tesco might be considering a £3billion rights issue.

[GTIR]

It's being savaged!


>must stop looking at my "Long term" investment<

[vescaegg]

WRN doing well

[afrochicken]

g4ry13 said:

I have the midas touch, a really strange thing for him to come out with so soon after his Tesco investmnent considering he's the long term investment guy.

It was a good 2 or 2 and a half years ago that he last bought Tesco as far as I know. It was around 280p-300p, and he sold some at 380p-400p if my memory serves me correctly. I've never had the impression that he was all that comfortable with the stake, but for some reason was reluctant to get completely out of it.

[Oakey]

vescaegg said:

WRN doing well

Just a minor blip. It's totally going to recover.

[gaz1234]

Oakey said:

Just a minor blip. It's totally going to recover.

Na

[g4ry13]

afrochicken said:

g4ry13 said:

I have the midas touch, a really strange thing for him to come out with so soon after his Tesco investmnent considering he's the long term investment guy.

It was a good 2 or 2 and a half years ago that he last bought Tesco as far as I know. It was around 280p-300p, and he sold some at 380p-400p if my memory serves me correctly. I've never had the impression that he was all that comfortable with the stake, but for some reason was reluctant to get completely out of it.

It doesn't really make sense that he would announce he's made a mistake. He knows it would lower the price and if he believed it was a mistake he would first get out of it before announcing it as it would inevitably end up losing him even more money.

Unless his strategy is to bluff, lower the price and buy more. He's a value investor after all and nothing new has emerged from the time he invested when they were being investigated and the day he announced his mistake. So possibly he could be buying even more as price falls as long term nothing changed in that period.

[wilwak]

Phateuk said:

I've got an account with http://www.iweb-sharedealing.co.uk which is part of Halifax. Only £5 per trade, and no monthly/annual fees

The reason I closed my previous shares account (with my bank at the time) was the account fees were costing me more than I was making on my small investments

I have Barclays Stockbrokers accounts for trading, SIPP and ISA. I also have Halifax IWeb.

On the face of it iWeb is cheaper but I find the spreads offered by Barclays vastly superior which more than offsets the few pounds extra dealing commission.

Barclays are a proper broker. iWeb is a bit amateur IMO. They don't offer as many stocks as Barclays.

[wilwak]

Shnozz said:

To those more educated than myself (all of you..), can anyone give a precis of the real estate position on Tesco? Is their property portfolio sufficiently strong to underpin the market cap at a particular price point?

I read an article last week that said Tesco had sold (and leased back) most it's stores to fund it's failed expansion overseas.

It said that money had now gone.

Tesco had failed to invest in its then booming uk business and put all it's focus overseas.