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Hudson's Bay Company (HBC-T)

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  • Oct 23rd, 2017 10:06 am
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[OP]
Deal Addict
Jun 3, 2009
3658 posts
434 upvotes
Montreal

Hudson's Bay Company (HBC-T)

Is anyone buying this? It looks attractive at this level to me.

http://www.businesswire.com/news/home/20151210006538/en
Consolidated sales growth of 34.1%, up $653 million from prior year with same
store sales growth of 12.9% (up 2% on a constant currency basis)

Adjusted EBITDAR up 50% to $272 million from the third quarter of Fiscal 2014

Generates Net Earnings of $1 Million compared to a Net Loss of $13 Million
74 replies
Member
User avatar
Oct 13, 2009
208 posts
46 upvotes
North York
It's time!!!!!

bring back Zellers!!! I miss Zeddy the Bear this time of year...
Jr. Member
Aug 12, 2015
171 posts
34 upvotes
Toronto, ON
Helps them quite a lot being the only major department store nationally now that Sears is mostly out of their way with the exception of the odd store leftover.

Would still look at taking profits after the holiday season though.
Deal Addict
Jul 23, 2007
3231 posts
1098 upvotes
I bought Hudson's Bay stock shortly after the crash of 87. Managed to get a double out of it a few months later before selling. It's gone through a lot of changes since these days but I never was interested in buying into it again.
Member
May 31, 2008
452 posts
226 upvotes
Toronto
Its down b/c they dont see their sales in Europe doing too well for the remainder of 2015 and throughout 2016.
[OP]
Deal Addict
Jun 3, 2009
3658 posts
434 upvotes
Montreal
submalst wrote:
Dec 14th, 2015 7:40 pm
Its down b/c they dont see their sales in Europe doing too well for the remainder of 2015 and throughout 2016.
Don't you think it's a decent value play with a forward PEG of 0.5 and the CEO unlocking value of real estate?
Member
May 31, 2008
452 posts
226 upvotes
Toronto
cn_habs wrote:
Dec 14th, 2015 8:05 pm
Don't you think it's a decent value play with a forward PEG of 0.5 and the CEO unlocking value of real estate?

That being said, they don't pull the trigger on creating a REIT and instead are focused more on joint ventures for their real estate and they seem to be spending cash on inorganic growth at the moment. I think if your in for the long haul- sure-seems to be a good deal right now- but short term- lets see what happens with the Saks rollout in Canada with the economy as it is and the Q4 sales (with no winter to speak of in the east coast- piles of discounted winter stock for Q1 that will be impacting the bay, lord and taylor and saks).
Deal Addict
User avatar
Oct 9, 2008
3973 posts
846 upvotes
Thornhill
Without looking at any valuations, I'd stay far away from HBC just based on their business model.

Overhead for big box departments stores are high and won't be going lower, higher if anything. Foot traffic in their stores is also most likely not trending much higher, I would assume it'd be declining and won't be suddenly back to the previous levels ever again. I've recently noticed they're trying to compete more and more in the online space by trying to entice new shoppers online and instore by offering "sales" on their false MSRP's (which often still fall short of on-line retailer's price) and they're now starting to source cheaper 'outlet bound' merchandise from their partners and once again selling for an illusionary 'sale' price. This merchandise is of lower quality since it was sourced for this price and I think their older demographic shoppers may even turn against them for it.
[OP]
Deal Addict
Jun 3, 2009
3658 posts
434 upvotes
Montreal
HBC buying online retailer Gilt for $250M
The Toronto-based retailer says Gilt has more than nine million members and the acquisition is expected to add about $500 million US to HBC's overall revenue this year.
I do like the online focus of this acquisition especially the mobile penetration but HBC needs to stop this spending spree soon.
Deal Addict
Sep 20, 2014
1147 posts
364 upvotes
Calgary, AB
cn_habs wrote:
Jan 7th, 2016 9:03 pm
HBC buying online retailer Gilt for $250M



I do like the online focus of this acquisition especially the mobile penetration but HBC needs to stop this spending spree soon.
They won't anytime soon. That is the way the management operates and it has resulted in some great results over the years. Consider their recent acquisition of Saks Fifth Avenue, for example. They bought the entire company ($3.5 billion in revenue, 40+ locations) for $2.9 billion. Recent surveys have revealed that the Saks building in Manhattan is worth $3.7 billion alone.

I personally like the way the management operates as they look for hard asset values and then buy them cheap (a recent German retailer was also acquired). In this case, I suspect Gilt's technology will be well served. The HBC website is good but their mobile side leaves a lot to be desired - anything they can do to enhance that is a great step.

I still don't know what HBC's normal earning power is (thanks to zigzagging results and the acquisitions) but I do think they're slightly undervalued based purely on assets. Probably won't be buying them anytime soon.
Jr. Member
Mar 8, 2015
199 posts
59 upvotes
Added to my position after the "bad" earnings release and it got crunched by about 18%.....long-term play for sure. I bought it purely for the real estate, the estimated value of the Saks real estate is MORE than HBC's overall market cap, that should say something on its own. In theory the actual retail business itself could be generating 0 profits and HBC would still be worth the same as the Saks buildings-seems like a pretty nice floor to me. This market has been nuts and not making a whole lot of sense, i don't think most people understand the value of the real estate and what they're doing going forward to recognize this value. I know that the earnings missed analyst estimates but it barely missed it, it didn't justify the huge sell off IMO but whatever, i gladly picked some up @ a discount of $16.50.

I don't really like the most recent Gilt acquisition since they already have some debt on the balance sheet, and i do agree with some posters that retail ha snot performed well, but long-term i'm fine. Like others have mentioned Target is out of the picture and inevitably Sears will be too. I think HBC goes up from here and is well under-valued @ these levels, I just wouldn't expect the stock to hit the high 20s or low 30s again for at least another year. It will take some time for people to realize the true value of the company and it's real estate assets before it translates into a nice return for shareholders. Good luck to all who hold HBC.
Deal Fanatic
Jun 26, 2011
9915 posts
876 upvotes
Markham
J_u_n_i_o_r_3 wrote:
Dec 26th, 2016 9:28 pm
adding Wednesday
Also bought some today. First shares though, so hopefully getting in near the bottom. I think I may have to sit and wait on it for a while but based on the RE value I'm hopeful in the long term.
Deal Addict
Jul 3, 2006
1116 posts
174 upvotes
RolandCouch wrote:
Dec 28th, 2016 10:17 am
Also bought some today. First shares though, so hopefully getting in near the bottom. I think I may have to sit and wait on it for a while but based on the RE value I'm hopeful in the long term.
what was your avg price?

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