Friday, 20 April 2012


Somethings just never feel right. I rarely agree with Bryce Elder of FTAlphaville, but he has been a long-time critic of the Superdry brand. At the end of the day, they are just t-shirts and other very overpriced casual wear. yet the company has been in overdrive and its life as a listed company has been a gilded one.

This morning's news though is a classic in corporate governance. It turns out that SuperGroup (the owner)has been over-estimating its profits and growth by about 20%. No news yet of the Finance Director falling on his sword, but surely that will come in the next week or two. Six figure salaries and valuable share options should require a modicum of competence.

Sadly for SuperDry it has been a bad few months anyway as its stockmarket darling status has drained away.  Retails brands like this are always a difficult one, you can see it with the history of the likes of FCUK - they all seem to experience and Icarus moment. After this though, they trade sideways but quite nicely for years until snapped up by a larger player?

From a trading perspective too at 41% down and at 333p as opposed to 1400 it is a pretty strong base. As far as i can see it is priced at 3x next years earnings, compared to 9x for FCUk as an example - so I am tempted with a very small trade looking for a short term 20% upside.


Sebastian Weetabix said...

I long ago came to this conclusion about the rag trade: by the time I notice everyone is wearing some trendy company's schmutter, it's too late to buy the shares and I've missed the boat.

CityUnslicker said...

quite right and a wise piece of guidance there SW. Pleased with my 333 entry point though, might get that 20% by Monday with a small punt.

Anonymous said...

About four years ago my son (13) said "all the kids at school have Superdry jackets" - I'd never heard of them at the time, then discovered it was an expansion of Cult Clothing, whose two Cheltenham stores specialised in expensive hipster clobber for gilded Cotswold youth.

But now I see their stuff on overweight middle aged chaps in Swindon. The trend is only your friend 'til the bend.

Who owns all the shops that sell surf gear to non-surfers - brands like Hot Tuna and Animal - the Fat Faces of this world? I'd be surprised if their sales and/or margins are holding up...


Electro-Kevin said...

My Super-Cheap Chinese (solid top) guitar linked above.

As good as a US Martin @ 5x the price.

We're fucked, I tell yer.

(Headphones best to appreciate my playing)

Sean said...

Glad thats sorted out I thought they were a chain of dry cleaners.

andrew said...

stepdaughter has bursts of brand following punctuated by primark. iirc

she has stopped buying superdry and currently speaks well of jack wills