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You basically just explained exactly what the problem with this type of discussion is. What you guys are saying is purely vengefully hoping that your perceived enemy will lose money. GW's stock price isn't a reflection of the customer base's feelings.
Barfolomew wrote: [quote=dereksatkinson 578355 6586674 null
To me, Hasbro has a much better board because the majority is customer focused, not a bunch of accountants.
Does GW know what's going on in the company? Yes. Do they know how to fix it? Hell no.
Is that why Hasbro's share performance (blue) over thast 5 years is significantly worse than that of GAW?
Or, for that matter, is that why the FTSE All Share performance (Green) is worse than that of GAW?
This message was edited 1 time. Last update was at 2014/03/04 17:05:52
Oh look, Oblivion trotting out the wholly inappropriate Hasbro comparison again.
Hasbro are so far ahead of GW in size, they behave in an entirely different way, as I mentioned the last time you tried to compare them.
We find comfort among those who agree with us - growth among those who don't. - Frank Howard Clark
The wise man doubts often, and changes his mind; the fool is obstinate, and doubts not; he knows all things but his own ignorance.
The correct statement of individual rights is that everyone has the right to an opinion, but crucially, that opinion can be roundly ignored and even made fun of, particularly if it is demonstrably nonsense!” Professor Brian Cox
azreal13 wrote: Oh look, Oblivion trotting out the wholly inappropriate Hasbro comparison again.
Hasbro are so far ahead of GW in size, they behave in an entirely different way, as I mentioned the last time you tried to compare them.
You've missed the point. The graph is in response to a post commenting how Hasbro are doing so much better than GAW.
I provided facts; I know that's not as thrilling as vague assertions to the people who make those assertions.
Share price is not necessarily indicative of how a company is "doing."
Hasbro's 2014 revenue was $4.08 Billion dollars; I'd be surprised if GW has had that much revenue in all the time since they went public. Hasbro's earnings per diluted share were $2.83 in 2013, while GW's were under a dollar.
But, like azreal13 points out, comparing the two is kind of silly. The two companies are so dramatically different in size, scope, market presence, name recognition, etc., that it's just silly to compare the two.
Also, I have to point out another huge failing in the chart you showed. The chart is in percentages, not actual currency. Additionally, it's giving the GW share price in Great Britain pence and the Hasbro price in US dollars. If you convert the GW share price into US dollars, the figure is currently $7.95.
Notice the units that each one reports the share price is based on the fact that GW is on the London stock exchange, not New York, and Hasbro is on the New York exchange.
(edited for clarity)
This message was edited 3 times. Last update was at 2014/03/04 17:58:22
loki old fart wrote: It was the floods.
Every body knows England ends at watford gap. GW watford was closed as usual. and south of there was flooded
You know that Watford Gap and Watford are 66 miles apart right?
Unless that was a very subtle commentary on some of the macroeconomic factors that have been bandied about in this topic (and if it wasn't I wish it had been)
Yes I know. I used to be a recovery driver. I can even find places without a sat nav.
Its hard to be awesome, when your playing with little plastic men. Welcome to Fantasy 40k
If you think your important, in the great scheme of things. Do the water test.
Put your hands in a bucket of warm water,
then pull them out fast. The size of the hole shows how important you are.
I think we should roll some dice, to see if we should roll some dice, To decide if all this dice rolling is good for the game.
azreal13 wrote: Oh look, Oblivion trotting out the wholly inappropriate Hasbro comparison again.
Hasbro are so far ahead of GW in size, they behave in an entirely different way, as I mentioned the last time you tried to compare them.
You've missed the point. The graph is in response to a post commenting how Hasbro are doing so much better than GAW.
I provided facts; I know that's not as thrilling as vague assertions to the people who make those assertions.
Comparing a company whose individual share valuation is in excess of 10x GW's? Whose market cap is calculated in the billions, rather than millions?
You know that Corvus Belli growth chart that is completely irrelevant because it doesn't show any numbers beyond year on year growth as a percentage (and making £2 this year over £1 last year is 100% growth! Good Times!) This is barely more relevant. Comparing a small PLC like GW against the established, blue chip players whose share price growth will be much smaller in percentage terms is at best naive, if not disingenuous.
EDIT
Just to clarify a little further, it would take less than 2% (I think, my maths is rough and ready with about three tabs open to have all the info in front of me) increase in Hasbro share price to add a whole GW's worth of value to their total, that is the gulf between the two, you're technically comparing dogs here, but GW is a Chihuahua, Hasbro is a Great Dane.
This message was edited 1 time. Last update was at 2014/03/04 18:07:02
We find comfort among those who agree with us - growth among those who don't. - Frank Howard Clark
The wise man doubts often, and changes his mind; the fool is obstinate, and doubts not; he knows all things but his own ignorance.
The correct statement of individual rights is that everyone has the right to an opinion, but crucially, that opinion can be roundly ignored and even made fun of, particularly if it is demonstrably nonsense!” Professor Brian Cox
It's already been established that you guys are looking at trailing indicators while I've been looking at leading indicators. Leading indicators like Goldman's Global Leading Index is showing the global economy in slowdown mode. You wont even hear on the news that we are in a recession till 3 quarters after you've already been in one. So what good does that do you? You can point to retail sales but I can point to disposable income. Unless you see a major spike up there, discretionary spending is going to go through the floor. An already indebted consumer has it's lowest income:debt ratio since 07. It's going to be bloody when it finally hits.
Fair enough, I agree with most of that. On a side note, when do you think the fan is getting covered
Its hard to be awesome, when your playing with little plastic men. Welcome to Fantasy 40k
If you think your important, in the great scheme of things. Do the water test.
Put your hands in a bucket of warm water,
then pull them out fast. The size of the hole shows how important you are.
I think we should roll some dice, to see if we should roll some dice, To decide if all this dice rolling is good for the game.
It's already been established that you guys are looking at trailing indicators while I've been looking at leading indicators. Leading indicators like Goldman's Global Leading Index is showing the global economy in slowdown mode. You wont even hear on the news that we are in a recession till 3 quarters after you've already been in one. So what good does that do you? You can point to retail sales but I can point to disposable income. Unless you see a major spike up there, discretionary spending is going to go through the floor. An already indebted consumer has it's lowest income:debt ratio since 07. It's going to be bloody when it finally hits.
Fair enough, I agree with most of that. On a side note, when do you think the fan is getting covered
You do realise that he is talking about the same leading indicators that failed spectacularly in 2008 and plunged the world's economy in the gakky state that it is now, right?
I'd put as much faith in those as I do in the tarot reader in our public channel morning show...
It's already been established that you guys are looking at trailing indicators while I've been looking at leading indicators. Leading indicators like Goldman's Global Leading Index is showing the global economy in slowdown mode. You wont even hear on the news that we are in a recession till 3 quarters after you've already been in one. So what good does that do you? You can point to retail sales but I can point to disposable income. Unless you see a major spike up there, discretionary spending is going to go through the floor. An already indebted consumer has it's lowest income:debt ratio since 07. It's going to be bloody when it finally hits.
Fair enough, I agree with most of that. On a side note, when do you think the fan is getting covered
You do realise that he is talking about the same leading indicators that failed spectacularly in 2008 and plunged the world's economy in the gakky state that it is now, right?
I'd put as much faith in those as I do in the tarot reader in our public channel morning show...
There were multiple people predicting the events that led to the recession, but people just chose to ignore them.
Share price is not necessarily indicative of how a company is "doing."
Hasbro's 2014 revenue was $4.08 Billion dollars; I'd be surprised if GW has had that much revenue in all the time since they went public. Hasbro's earnings per diluted share were $2.83 in 2013, while GW's were under a dollar.
Hasbro is a bigger company than GW? You don't say. If you're assessing the quality of management - as suggested by the original post referring to Hasbro - it's percentage growth you need to look at, not size. If you inherit a big company and shrink it, you're not as good a manager as someone who inherits a small company and grows it, even if your revenue is higher.
If you don't want to compare GW with Hasbro, compare them with the FTSE all share - this reflects the general growth (or not) in the economy over the same period. In that context, they're not doing that badly. (altho of course the recent trend is bad).
This message was edited 2 times. Last update was at 2014/03/04 19:21:16
Share price is not necessarily indicative of how a company is "doing."
Hasbro's 2014 revenue was $4.08 Billion dollars; I'd be surprised if GW has had that much revenue in all the time since they went public. Hasbro's earnings per diluted share were $2.83 in 2013, while GW's were under a dollar.
Hasbro is a bigger company than GW? You don't say. If you're assessing the quality of management - as suggested by the original post referring to Hasbro - it's percentage growth you need to look at, not size. If you inherit a big company and shrink it, you're not as good a manager as someone who inherits a small company and grows it, even if your revenue is higher.
If you don't want to compare GW with Hasbro, compare them with the FTSE all share - this reflects the general growth (or not) in the economy over the same period. In that context, they're not doing that badly. (altho of course the recent trend is bad).
No offense, but you're demonstrating a fundamental lack of understanding of what's going on.
When you're already one of the huge market leaders in an industry, it is IMPOSSIBLE to have the same kind of percentage growth figures as a much smaller company. Smaller companies should ALWAYS have significantly larger percentage growth figures than larger, more well established companies.
A CEO who leads Hasbro to a 5% increase in revenue is infinitely better than a CEO who leads GW to a 20% increase in revenue because GW has a significantly higher potential for growth than does Hasbro. For Hasbro to experience a 5% increase in revenue, it would have to increase revenue by $200 Million; for GW to experience a 20% increase in revenue, they would only have to increase sales by $44 Million. A smaller company like GW has the opportunity to expand into markets where they do not currently have a significant presence; Hasbro has a significant presence in virtually every meaningful market on the planet. That right there points out how smaller companies have an easier time to make larger percentage growth figures than larger companies.
Again, as has been pointed out on multiple occassions, trying to compare the financials of GW and Hasbro is like you trying to compare your financials to Warren Buffett.
And, lastly, the chart you posted doesn't have anything to do with the "growth in the economy." It's stock prices, that's it. It's not comparing relative revenues, ROI figures, asset figures, or anything else. It's stock prices. And, if you adjust the GW figure to USD rather than insisting on keeping the calculation using percentages, then the GW line of the graph would be an insignificang and volatile track meandering around way down at the bottom of the chart.
This message was edited 4 times. Last update was at 2014/03/04 19:36:39
Even if you could compare GW to Hasbro, this is would the YTD numbers look this year.
GW highest price this year was 723 which is $12.07 USD. It's lowest price is 477 which is $7.96 and that's today. This means GW has lost 34% of it's value from it's peak. If one were to draw a line on the GW stock price trend, it would show a downward trend. GW's 1 year trend looks flat or as curve which is going down, while it's 5 year has been upwards, with what looks like a down turn now.
Hasbro's highest price this year was $55, today, with a low of $48. Even at $48 it only lost 13% of it's value. With a trend line, it is currently trending up, recovering from it's previous low. If you look at the 1 year and 5 year graph, it shows a trend up.
Not sure where you're getting a low of $48? It looks more like a daily low of $54.79.
That aside, they're currently at or near a 5 year high with a continual upward curve.
We find comfort among those who agree with us - growth among those who don't. - Frank Howard Clark
The wise man doubts often, and changes his mind; the fool is obstinate, and doubts not; he knows all things but his own ignorance.
The correct statement of individual rights is that everyone has the right to an opinion, but crucially, that opinion can be roundly ignored and even made fun of, particularly if it is demonstrably nonsense!” Professor Brian Cox
Ah right, I misread your post and thought you were just looking at today's trading.
I'd still rather have Hasbro's graph than GW's!
We find comfort among those who agree with us - growth among those who don't. - Frank Howard Clark
The wise man doubts often, and changes his mind; the fool is obstinate, and doubts not; he knows all things but his own ignorance.
The correct statement of individual rights is that everyone has the right to an opinion, but crucially, that opinion can be roundly ignored and even made fun of, particularly if it is demonstrably nonsense!” Professor Brian Cox
loki old fart wrote: Fair enough, I agree with most of that. On a side note, when do you think the fan is getting covered
Depends on what you mean by covered.. If you mean that the markets head lower, it could be any day now. We could have a 20% correction in as little as 2-3 months. That isn't a prediction, that is just a mathematical certainty that we will have to have a correction sooner rather than later. Rallies eventually run out of steam.
If you are talking when it will be obvious that things are crappy, I don't think you will have to wait too long. I would expect it some time this year but I don't have a crystal ball. If you want to know if the economy get out of it's funk, that is going to be much longer IMO. Likely going to require a complete leveling where debts are written off in mass. 08 on steroids.
Saldiven wrote: There were multiple people predicting the events that led to the recession, but people just chose to ignore them.
I am on record several hundred times. With Oil, Gold and the overall economy. I mentioned this earlier in the thread that you could find my comments under the screenname derekatkinson
Automatically Appended Next Post:
azreal13 wrote: Comparing a company whose individual share valuation is in excess of 10x GW's? Whose market cap is calculated in the billions, rather than millions?
You know that Corvus Belli growth chart that is completely irrelevant because it doesn't show any numbers beyond year on year growth as a percentage (and making £2 this year over £1 last year is 100% growth! Good Times!) This is barely more relevant. Comparing a small PLC like GW against the established, blue chip players whose share price growth will be much smaller in percentage terms is at best naive, if not disingenuous.
Also they are in different markets in all honesty..
This message was edited 1 time. Last update was at 2014/03/04 21:03:23
Well, yes and no, Hasbro own WOTC, so have an interest in the market sector, but don't have a bona fide miniatures wargame in their portfolio. (Unless you get fairly liberal with that definition)
The point that was being attempted is that they are often held up as the potential saviours of GW and the most likely to attempt a buyout, yet their own share performance was below GW's even after the drop.
Which, of course, isn't exactly the case...
We find comfort among those who agree with us - growth among those who don't. - Frank Howard Clark
The wise man doubts often, and changes his mind; the fool is obstinate, and doubts not; he knows all things but his own ignorance.
The correct statement of individual rights is that everyone has the right to an opinion, but crucially, that opinion can be roundly ignored and even made fun of, particularly if it is demonstrably nonsense!” Professor Brian Cox
loki old fart wrote: Fair enough, I agree with most of that. On a side note, when do you think the fan is getting covered
Depends on what you mean by covered.. If you mean that the markets head lower, it could be any day now. We could have a 20% correction in as little as 2-3 months. That isn't a prediction, that is just a mathematical certainty that we will have to have a correction sooner rather than later. Rallies eventually run out of steam.
If you are talking when it will be obvious that things are crappy, I don't think you will have to wait too long. I would expect it some time this year but I don't have a crystal ball. If you want to know if the economy get out of it's funk, that is going to be much longer IMO. Likely going to require a complete leveling where debts are written off in mass. 08 on steroids.
correction, What a lovely word, you can hide a multitude of sins in that word
Its hard to be awesome, when your playing with little plastic men. Welcome to Fantasy 40k
If you think your important, in the great scheme of things. Do the water test.
Put your hands in a bucket of warm water,
then pull them out fast. The size of the hole shows how important you are.
I think we should roll some dice, to see if we should roll some dice, To decide if all this dice rolling is good for the game.
Please, folks - let us stop arguing about how fish bladders might be employed to prevent earthquakes, or how Cypriot youth employment impacts a British toy company.
This argument has been spinning in circles - ignore it, it has a fixed axis, and is going nowhere.
The drop in GW stock prices is a reflection, and only a reflection, of how GW - the company, not the stock - is doing.
GW didn't have a dividend - so stock holders are unloading, and likely will continue doing so until the next report.
Then, if GW once again passes on handing out dividends... the stock might (might) go into freefall again, with more auto sells kicking in.
I am of the opinion that GW has been too eager to hand out dividends in the past - that the funds might have been used to better purpose - from advertising, to putting more models in a box, to dropping the prices of the boxes, whichever makes you happy.
Until that next report... we are only guessing - accurately in some cases, dead wrong in others - but still only guessing.
At this point... I really would have difficulty caring less as to how GW is doing - I am much more concerned with how a complete collapse of GW would hurt the supporting companies.
Heck - the Knight is the first model by GW that has interested me in over a year, and even there, I have no real intent to ever use it in a game of WH40K. (The closest that I have come to playing WH40K in two years is Necromunda.)
And I consider having interest in that one model to be a vast improvement over my feelings in the last two years.
As many have said - it is not the prices exactly that are hurting GW sales - it is perceived value for money. The Knight is expensive, but it looks to be decent value for that price.
I have much the same feeling about their terrain.
So, yeah, I intend to wait and see - maybe buy a Knight, unless I decide to get a WARMACHINE Colossal or the Dreamforge Mortis instead.
And in the meanwhile, I will ignore most of GW's releases, and continue to buy from other companies.... which is a part of what is causing GW's problems - I have no need and little desire to buy their products at this point in time.
The Auld Grump
This message was edited 1 time. Last update was at 2014/03/05 05:35:53
Kilkrazy wrote:When I was a young boy all my wargames were narratively based because I played with my toy soldiers and vehicles without the use of any rules.
The reason I bought rules and became a real wargamer was because I wanted a properly thought out structure to govern the action instead of just making things up as I went along.
I have a hunch, why CEO Tom Kirby was so eager to give shareholder Tom Kirby 1 Mio £ dividends per year and why Chairman Tom Kirby approved this Half a year ago in the annual report, Tom Kirby stated he saw no reasonable way to invest about 20 Mio £ within the company. Now he has to forgo his own dividend and risk a share price avalanche (which then took place). Things must be so dire that even he can't hide it anymore to the shareholders.
Herzlos wrote: The consumers aren't all struggling though; retail sales in GW's home market has started increasing again. Confidence and real terms income are still down on 7 years ago but it's picking up.
Anyway, what do you make of the market in general, and what would you need to see to concede that the gaming market (outside of GW) is doing pretty well?
It's already been established that you guys are looking at trailing indicators while I've been looking at leading indicators. Leading indicators like Goldman's Global Leading Index is showing the global economy in slowdown mode. You wont even hear on the news that we are in a recession till 3 quarters after you've already been in one. So what good does that do you? You can point to retail sales but I can point to disposable income. Unless you see a major spike up there, discretionary spending is going to go through the floor. An already indebted consumer has it's lowest income:debt ratio since 07. It's going to be bloody when it finally hits.
Maybe I don't understand this, but you're saying that the drop in GW's share price is because the markets are about to collapse in the future, and that they are shrinking because people are starting to feel the squeeze again?
If that was the case, wouldn't the same thing be impacting everyone else? For instance, Wayland Games, where games sales are up (just not GW), or the stock market in general?
I certainly agree that if we drop into another recession it'll be a bad one, but from where I stand (someone in the UK with little global awareness) confidence is still building (even if it shouldn't). It is all cyclical and we seem to decline every 10 years or so meaning that we're going to be due another one soon.
Herzlos wrote: The consumers aren't all struggling though; retail sales in GW's home market has started increasing again. Confidence and real terms income are still down on 7 years ago but it's picking up.
Anyway, what do you make of the market in general, and what would you need to see to concede that the gaming market (outside of GW) is doing pretty well?
It's already been established that you guys are looking at trailing indicators while I've been looking at leading indicators. Leading indicators like Goldman's Global Leading Index is showing the global economy in slowdown mode. You wont even hear on the news that we are in a recession till 3 quarters after you've already been in one. So what good does that do you? You can point to retail sales but I can point to disposable income. Unless you see a major spike up there, discretionary spending is going to go through the floor. An already indebted consumer has it's lowest income:debt ratio since 07. It's going to be bloody when it finally hits.
Maybe I don't understand this, but you're saying that the drop in GW's share price is because the markets are about to collapse in the future, and that they are shrinking because people are starting to feel the squeeze again?
If that was the case, wouldn't the same thing be impacting everyone else? For instance, Wayland Games, where games sales are up (just not GW), or the stock market in general?
I certainly agree that if we drop into another recession it'll be a bad one, but from where I stand (someone in the UK with little global awareness) confidence is still building (even if it shouldn't). It is all cyclical and we seem to decline every 10 years or so meaning that we're going to be due another one soon.
I think that is the general trend. People are feeling the pinch. And are reluctant to give up their hobby(why should they). And are buying models with perceived better value, GW's pricing isn't helping here. This would explain why other companies are doing better.
Its hard to be awesome, when your playing with little plastic men. Welcome to Fantasy 40k
If you think your important, in the great scheme of things. Do the water test.
Put your hands in a bucket of warm water,
then pull them out fast. The size of the hole shows how important you are.
I think we should roll some dice, to see if we should roll some dice, To decide if all this dice rolling is good for the game.
Herzlos wrote: Maybe I don't understand this, but you're saying that the drop in GW's share price is because the markets are about to collapse in the future, and that they are shrinking because people are starting to feel the squeeze again?
If that was the case, wouldn't the same thing be impacting everyone else? For instance, Wayland Games, where games sales are up (just not GW), or the stock market in general?
I can't speak for Wayland Games' sales or how they do their accounting. It is worth noting though that historically, GW has shown to be very sensitive to changes in economic conditions and their share price dropped ahead of each of the past 2 market crashes. Each time they bottomed out before the indexes. Since they are a specialty niche market retailer, that's how i'd expect their chart to move.
I indicated earlier that leading indicators are basically saying that we are already seeing a slowdown. The stock market is already showing major divergences. I showed you guys what a RSI divergence was and how it signals that we are setup for a decline. That's not the only negative divergence from a technical perspective either. I could go into market breadth, new hi/new lows and volume analysis but that is way too deep of a discussion. If I find a good article, i'll forward it over.
Now, I have mentioned that disposable income is showing that the consumer is losing ground and will likely have to cut back on spending. Zerohedge posted this article this morning that touches on a series of economic indicators that are showing that this "recovery" isn't real and we are actually in a decline already. Consumers are currently digging themselves a hole and their increases in income and spending have not outpaced inflation. http://www.zerohedge.com/news/2014-03-05/what-needs-happen-we-see-big-recovery
I'm sure you can find another indicator that says "everything is okay" just like people could from 2007 all the way to the summer of 2008. This is basically a muddy water dilemma at which point you need to get context about where you are in the cycle and make a determination about what is more consistent with historical precedence. It is my opinion that timing wise we are already beyond the average time frame for a cyclical recovery and the market is currently priced to perfection. The problem is that we are NOT in a perfect world. If anything goes wrong, you end up with air pockets and a collapse in asset prices. If you were an adult during the last cyclical decline, you should know by now that small unrelated things become big world events because of this phenomenon.
This time isn't different. I don't know what it will be next time but I do know the banks are levered, the consumer is levered and governments are levered to the hilt while rates are at historic lows. That's a recipe for disaster.
Automatically Appended Next Post:
loki old fart wrote: I think that is the general trend. People are feeling the pinch. And are reluctant to give up their hobby(why should they). And are buying models with perceived better value, GW's pricing isn't helping here. This would explain why other companies are doing better.
Or maybe they are playing games with their revenue numbers to make things look better than they actually are while GW is recognizing expenses/costs to clean up their balance sheet. The reason the CEO gave for why they paid out the dividend tells you that they thought things were going to be gakky and you are better off putting your money elsewhere. Meanwhile their competition is spending money like crazy and expanding into the tail end of the cycle.
This message was edited 1 time. Last update was at 2014/03/05 15:00:25
Herzlos wrote: Maybe I don't understand this, but you're saying that the drop in GW's share price is because the markets are about to collapse in the future, and that they are shrinking because people are starting to feel the squeeze again?
If that was the case, wouldn't the same thing be impacting everyone else? For instance, Wayland Games, where games sales are up (just not GW), or the stock market in general?
I can't speak for Wayland Games' sales or how they do their accounting. It is worth noting though that historically, GW has shown to be very sensitive to changes in economic conditions and their share price dropped ahead of each of the past 2 market crashes. Each time they bottomed out before the indexes. Since they are a specialty niche market retailer, that's how i'd expect their chart to move.
The same GW that claimed to be recession proof in its financial statements?
Maybe the previous dips happen to land near market depressions, but they also happen to land after internal booms have ended, namely the LOTR franchise in ~2005-6 (when the economy didn't tank here until 2007 - I know since I bought a house at the absolute peak and haven't caught up yet), after the 3rd movie buzz (released in 2003) died down and (I think) the MB games partnership around 2000 (I don't remember that very well).
Looking at the stock price I don't see anything to indicate that they are sensitive to changes in economic condition at all.
As to Wayland Games, it doesn't matter too much how they do their accounting; they are experiencing growth that isn't coming from GW (according to the owner, on Warseer) and I can't think of a reason why he'd make that up or why he'd try and use accounting tricks to show that effect. He says:
Our sales are up approx 15 to 20% on last year, all of the increase is in non GW. GW are following a selective distribution model that real hardcore luxury brands like to follow as in some ways it stokes demand and maintains high prices. However, GW despite having nice products is not and never will be a Luxury brand in the normal sense. Competitors are getting better all the time, however no one has really seized on the vacuum being left. The supply chain in this industry is still pretty woeful which massively hurts other games ability to grow significantly.
So sales are up a lot (and this is GW's main reseller so it's a 15-20% increase on a lot) but not coming from GW, and a lot of other games systems are having problems with growth because of poor distribution.
I'm not ignoring the rest of your post, just adding this whilst I digest the rest.
Now, I have mentioned that disposable income is showing that the consumer is losing ground and will likely have to cut back on spending. Zerohedge posted this article this morning that touches on a series of economic indicators that are showing that this "recovery" isn't real and we are actually in a decline already. Consumers are currently digging themselves a hole and their increases in income and spending have not outpaced inflation. http://www.zerohedge.com/news/2014-03-05/what-needs-happen-we-see-big-recovery
That seems to contradict itself. Your say that customers will have to cut back on spending, but they are currently spending too much. So you're saying that in the future customer spending will drop but at the moment it's still high? In which case, how does that explain why GW's revenues are down significantly in the current/recent past if the consumer spending hasn't happened yet?
Incidentally; I agree with you about the economy; it's in poor shape and about to get worse. I just don't think that's the problem with GW as it doesn't seem to fit what we know.
This message was edited 6 times. Last update was at 2014/03/05 15:51:52
Has Wayland Games released any hard data, or are we just taking them at their word?
Additionally, even if he's being 100% truthful with his percentages, they're still pretty meaningless if his revenues are measured in the six digits rather than the nine digits.
An argument can be made that the reason he's being more successful is because it's a massive discount service. Are companies that don't offer those discounts seeing the same improvements in sales?
Also, sales increases aren't the same as revenue increases. Did his 15-20% increase in sales realize a consumate increase in revenue, or did they merely offset the discount? Without hard data, his statements don't really tell us enough.
That seems to contradict itself. Your say that customers will have to cut back on spending, but they are currently spending too much. So you're saying that in the future customer spending will drop but at the moment it's still high? In which case, how does that explain why GW's revenues are down significantly in the current/recent past if the consumer spending hasn't happened yet?
It doesn't contradict itself. The economy is already showing signs that we are in decline. People are spending more than they actually make so you are seeing a drop in savings and the consumer is taking on debt to maintain a lifestyle. You are also seeing people look for cheaper alternatives. So instead of steak they are getting hamburger. At some point, they will have to cut their spending back a lot more.
The fact that specific company A or B hasn't posted that information up on their promotional fliers is completely irrelevant. The question you need to ask yourself is why any company that isn't public would be revealing sales numbers to it's customer base in the 1st place. The only reason I can think of is to gain credibility with potential customers who are on the fence. You want people to feel comfortable and not have them worried that they are wasting their money.
As for public companies, sales and revenue can be pulled forward from future quarters to make the current period look better than it actually is. Best Buy is an excellent case study of this with how they account for their gift cards. It finally caught up with them this past quarter and the stock got cut in half. There are TONS of ways to play with revenue to mask the underlying fundamentals. John Del Vecchio wrote a book on it that was the McGraw Hill best seller last year.
As for the underlying fundamentals themselves, we are seeing the numbers come out and they aren't painting a rosy picture. ISM came out today is looking like it wants to go back below 50 which would indicate a contracting economy. ISM Services are already indicating a contraction. Mind you, I thought this before even seeing these numbers. This only confirms it.
Spoiler:
And like I said before.. Everything is connected when it comes to markets. If the US, Europe or Asia go into recession we are all going to feel the pain. Some just more than others. De-leveraging will happen though.
This message was edited 2 times. Last update was at 2014/03/05 16:19:55
Herzlos wrote: Maybe I don't understand this, but you're saying that the drop in GW's share price is because the markets are about to collapse in the future, and that they are shrinking because people are starting to feel the squeeze again?
If that was the case, wouldn't the same thing be impacting everyone else? For instance, Wayland Games, where games sales are up (just not GW), or the stock market in general?
I can't speak for Wayland Games' sales or how they do their accounting. It is worth noting though that historically, GW has shown to be very sensitive to changes in economic conditions and their share price dropped ahead of each of the past 2 market crashes. Each time they bottomed out before the indexes. Since they are a specialty niche market retailer, that's how i'd expect their chart to move.
I indicated earlier that leading indicators are basically saying that we are already seeing a slowdown. The stock market is already showing major divergences. I showed you guys what a RSI divergence was and how it signals that we are setup for a decline. That's not the only negative divergence from a technical perspective either. I could go into market breadth, new hi/new lows and volume analysis but that is way too deep of a discussion. If I find a good article, i'll forward it over.
Now, I have mentioned that disposable income is showing that the consumer is losing ground and will likely have to cut back on spending. Zerohedge posted this article this morning that touches on a series of economic indicators that are showing that this "recovery" isn't real and we are actually in a decline already. Consumers are currently digging themselves a hole and their increases in income and spending have not outpaced inflation. http://www.zerohedge.com/news/2014-03-05/what-needs-happen-we-see-big-recovery
I'm sure you can find another indicator that says "everything is okay" just like people could from 2007 all the way to the summer of 2008. This is basically a muddy water dilemma at which point you need to get context about where you are in the cycle and make a determination about what is more consistent with historical precedence. It is my opinion that timing wise we are already beyond the average time frame for a cyclical recovery and the market is currently priced to perfection. The problem is that we are NOT in a perfect world. If anything goes wrong, you end up with air pockets and a collapse in asset prices. If you were an adult during the last cyclical decline, you should know by now that small unrelated things become big world events because of this phenomenon.
This time isn't different. I don't know what it will be next time but I do know the banks are levered, the consumer is levered and governments are levered to the hilt while rates are at historic lows. That's a recipe for disaster.
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loki old fart wrote: I think that is the general trend. People are feeling the pinch. And are reluctant to give up their hobby(why should they). And are buying models with perceived better value, GW's pricing isn't helping here. This would explain why other companies are doing better.
Meanwhile their competition is spending money like crazy and expanding into the tail end of the cycle.
I agree the economy is fethed up. Printing money does that for you.
As to the competition they are small compared to GW, and up is the only way to go.
Its hard to be awesome, when your playing with little plastic men. Welcome to Fantasy 40k
If you think your important, in the great scheme of things. Do the water test.
Put your hands in a bucket of warm water,
then pull them out fast. The size of the hole shows how important you are.
I think we should roll some dice, to see if we should roll some dice, To decide if all this dice rolling is good for the game.
As to the competition they are small compared to GW, and up is the only way to go.
Well.. We probably have seen "too much" competition enter the gaming space honestly. So bankruptcy for the business and going back to your day job might end up being the route a lot of these guys head.
CSM Undivided
CSM Khorne 
