Myer Share offer

What are people's thoughts on this offering https://www.mypieceofmyer.com.au/Pages/Default.aspx?

The Offer comprises:
– The Retail Offer, consisting of:
– The MYER one Priority Offer open to Eligible MYER one Members;
– The Employee Priority Offer open to Eligible Employees;
– The Employee Gift Offer open to Eligible Employees;
– The Broker Firm Offer open to Australian and New Zealand resident Retail Investors who have received a firm allocation from their Broker;
– The Noteholder Exchange Offer to Eligible Myer Noteholders; and
– The Institutional Offer, which consists of an invitation to bid for Shares made to Institutional Investors in Australia, New Zealand and a number of other overseas jurisdictions.
The allocation of Shares between the Retail Offer and the Institutional Offer will be determined by NB Swanston, the Company and the Joint Lead Managers at their discretion, having regard to the allocation policy described in Sections 3.5.4 and 3.7.4.
No general public offer will be made under the Offer.
 
I did read on the weekend, someone's warning (can't remember who) not to get caught up in the lovely PR glossy publications featuring Jen Hawkins.
 
What are people's thoughts on this offering https://www.mypieceofmyer.com.au/Pages/Default.aspx?

The Offer comprises:
– The Retail Offer, consisting of:
– The MYER one Priority Offer open to Eligible MYER one Members;
– The Employee Priority Offer open to Eligible Employees;
– The Employee Gift Offer open to Eligible Employees;
– The Broker Firm Offer open to Australian and New Zealand resident Retail Investors who have received a firm allocation from their Broker;
– The Noteholder Exchange Offer to Eligible Myer Noteholders; and
– The Institutional Offer, which consists of an invitation to bid for Shares made to Institutional Investors in Australia, New Zealand and a number of other overseas jurisdictions.
The allocation of Shares between the Retail Offer and the Institutional Offer will be determined by NB Swanston, the Company and the Joint Lead Managers at their discretion, having regard to the allocation policy described in Sections 3.5.4 and 3.7.4.
No general public offer will be made under the Offer.
All you have to do is join Myer on line,use that number then apply on line for what ever number you require,it's interesting to see that they don't want any US investors,you would not want the buy dump and burn crew coming into this set-up over the first few days..imho..willair
 
Retail is a very demanding sector that has changed a lot due to the advent of online shopping. Plus it is a super competitive industry too.

I imagine that big places like Myer have a huge infrastructural and running costs - whereas the likes of Amazon, online travel places, cosmetic places, ebay shops etc do not have such overhead - and therefore can charge a cheaper cost.

Retail is going to get more competitive in years to come due to increasing online shopping facilities etc. So be very wary of anyone who has a large and expensive physical presence.

Yes it is true that people can get a dose of retail therapy by going to a mall, but ocming down to it - you can buy a tele far cheaper at JB Hifi then you can at Myer. Clothing is much cheaper at the many outlet stores that now sit close by to most people, and the same can be said for cosmetics, sports equipment, books etc.

In other words, Myer is in an industry that is very competitive, the margins are not that good (unless they have huge markups for snobby suckers who like t buy there), and they also have expensive overheads - ie marble floors in their large shops, staff hanging around all day, large CBD or shopping mall locations etc (I would hate to think what the running costs of a typical inner city Myer store would be). Plus, they are not exclusive in any of their products or merchandising.

My thoughts anyway.


Thanks


g
 
I'm not keen on this IPO because
1) its a private equity sell back to market. Previous private equity floats have not done very well, look at Pacific Brands for example.
2) you dont know the price, you have to pay upfront and the price will be determined by book build any where between i think its $3.80-$4.90. Thats a big variance to pay first and find out later.
3) its not 'cheap', especially as the expense 'fat' has already been scrubbed, so there is not the opportunity for cost cutting, only revenue expansion (margin expansion might be hard as well given that its already a lean operation).

There is probably a good chance of receiving a stag profit by selling on listing, but im not participating.
 
Not a stock I'd be interested in. Private equity boys have already been through and ripped out most of the efficiencies available in the business (supply chain etc) so you're pretty much buying the business as good as it can be (at this point in time, who knows what future techbology etc will bring) and fairly priced.

I'd rather buy something that is still being under priced by the market, and has better growth opportunities. Time to buy Myer would be in a year or two when something unforeseen happens and the share price gets slammed by the markets but the fundamentals of it's business are still sound (eg. DJS and other retailers earlier this year).
 
I put in $2 k at the eleventh hour... and am sure I'll make some when it opens on 2 Nov / 11 Nov ?
Only problem is, everyone will think that too so there will be many selling. And if you were keen to buy, then you would have done it through the IPO.
 
Only problem is, everyone will think that too so there will be many selling. And if you were keen to buy, then you would have done it through the IPO.

It would also be relatively fairly priced. So whilst it may open at a premium (keeps everyone happy), it won't be anything spectacular otherwise the underwriters and vendors have stuffed up. Then throw into that the small parcels of shares most mums and dads would have, it's pretty hard to sell out at a decent profit eg. even a 20% premium on listing which is good, on a parcel of $2k is $400 - less brokerage & CGT. Not really worth the hassle and risk/reward.
 
i dont think its possible to know where the stock will price itself over the next 6 months. There are too many factors that need to be considered including significant unknowns mainly the level of institutional holdings.

Index funds will have to buy to match the index, so it will depend on the amount of stock they have been issued relative to the required size.

To a lesser degree so will long only equity funds, mainly because they dont want to appear 'dumb' if the stock does perform well.

However having said the above, i didnt participate in the float.
Whats the worst case scenario: i missed an opportunity but i still have my capital.

When evaluating stocks always look at downside risk compared to upside potential.

This is a 'secret' that i have slowly learned over 15yrs of investing and have come to realise is one of the cornerstone investing principles of the true professionals. Most retail investors just focus on how much 'upside' is there (how much do you think a share can go up?). The professionals focus on the 'downside risk'.

Investing is like running a marathon. There is no point completing a leg faster than others if you fail to complete the race. Translated into investing, there is no point achieving 'super charged' investment returns, if you blow up all your capital during your investing lifetime.

Only allocate new capital where the upside potential significantly outweighs the potential downside risk.
 
well listed today and is trading down 5% on its $4.10 issue price, so hope nobody bought this stock for stag profits on open day.
 
I'm waiting for the half price sale. I haven't paid full price for anything at Myer for years so why start with the shares.
 
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