I don’t have specific insight in Ted Baker but generally speaking retail sales are down at the moment.
Ted Baker’s been hit along with the whole retail industry but it had held up better than others, that is until the recent hugging scandal! I think this dominates the share price now until they announce the findings of the independent investigation.
There is definitely an argument to buy the dip as recent results show that the PR disaster didn’t appear to effect sales (or at least not yet). A large proportion of sales are outside the UK (around 40%), so overseas they won’t hear these allegations. If the investigation results aren’t as negative as articles suggest then there’s upside.
That being said there’s a major risk that more stories of harassment emerge (which isn’t a nice thought) and the board sack Ray Kelvin. Would people buy a brand associated with him afterwards? It might make the Ted Baker company look responsible for sacking him but it would also put people off. He also owns around a third of the shares, so if he started selling then it would really hurt the share price.
@Rob14 thanks for the good analysis. I totally agree and I think it is better to wait a bit to see what the final trend would be.
So Ted Baker’s shares are down today but apparently the ‘hugging’ scandal isn’t affecting sales
The retailer’s Christmas trading update last month showed a 12.2% rise in sales.
Looks like the CEO could do with a hug…
The Chief Executive’s left now. I don’t remember ever hearing any ‘visionary leader’ comments about them so perhaps this won’t affect the company’s performance long term.
I haven’t invested in Ted Baker but on the surface think the brand would be strong enough to pull through this scandal?
Will try and do some research into this company during the week!
They issued a profit warning because of “extremely difficult trading conditions”…
EDIT: In other news, Ted Baker now offers a high dividend yield of ~6% at the current prices. Although they’ll more than likely change their dividend amount in the future.
Should this be on Snapshot of High Dividend Yields on the Freetrade App?
At 4pm I’m buying some shares as well. At least I will certainly be buying into the dip. Looks like a risk of buying into a failing company though.
I’m waiting for it to fall further.
Funnily, this is my pick for the Stock Prediction League
In the 340’s now…time to buy?
Personally I don’t see it being a mega success again. The high street is dying in my opinion
Yes all been a downward spiral since then, someone may make a bid to buy though
They’ve extended their 30% off period till tonight and sent loads of emails to those who are signed up! Looks like they’re pretty keen to get cash through the door…
They also opened a new store!
High Street stores often are generational. They are popular for a time period. Then they succumb to the high cost of running a store in the UK. You need to ship so much stuff to pay for a months rent, rates and wages.
Warren Buffet says never buy dying businesses. It’s so rare to see a failing business turned around and become successful. It’s not like there aren’t other businesses out there that are:
a) making profit
b) have a great potential for growth
Retail for me is just too high risk.
Like some of you had said, someone may come and turn it around. But I think Ted Baker is a sinking ship.
Profit warnings are hard things to recover from. Especially when the high street isn’t as strong any more, it also goes to show that people have fallen out of love with the brand.
As people would just buy it online. But people aren’t clearly. The brand it’s self has gone downhill
I just spotted this when looking through the Ted Baker RNS.
Toscafund Asset Management LLP has taken a 12.6% stake. A quick Google search suggest this hedge fund has a history of taking position in troubled firms that it think can be fixed.
I think the brand is still valuable, but discounting has continued (as mentioned) and now in the 50% off region. I went into our local store (Meadowhall) thoough, it didn’t feel like a “fire sale”.
The recent update isn’t great, but at least they will make money for the year.
FULL YEAR OUTLOOK
Expectations for the period ending 25th January 2020 have been reduced to a minimum profit before tax of £5m, with a potential outcome of up to £10m dependent on Christmas trading and final year-end review.