NCK is the furniture/sofa company. They are, without a doubt, the best in the business at selling sofa’s.
Here’s the reason the stock was off so much, despite a pretty good result.
January 2023 was better then expected (that’s good) but down 12% on Jan 2022.
From the earnings outlook, we can see the FY 2023 is above, not below, 2022. If Jan is their best month, and yet a 12% fall was better than management thought then a) mgmt are fairly bearish and, in expressing their mildly surprised delight at how things are, makes it difficult for a fund manager to get behind the trade and b) that reaching 2023 earnings looks pretty unlikely.
So the stock is cum downgrade risk, and has a large run. We’ve missed NCK on the up, and, (in this case, with luck) we’ll miss it on the way down too.
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