Small Caps Podcast with Paul Scott – Episode 10

Paul’s usual weekly summary of the Stockopedia small cap value reports, now in our 10th anniversary year! It’s been another week dominated by the energy crisis, and a return to the June/July lows for small-mid caps. I talk about individual companies, and also how I cope with bear markets on a human level.

Welcome to all our new listeners who are coming on board via the Apple podcasts platform.

I love feedback & to hear your views, so please post away in the comments below, open to all. Just keep it courteous, then all views are welcomed 🙂

As always, these are just my personal opinions, which are subject to change with events, and will sometimes be right, and sometimes wrong! Never financial advice, just enthusiastic views & commentary.

EDIT: Many thanks to James, who has kindly posted the running order in the comments below, so people can jump easily to individual companies of interest. What a helpful gesture, thanks! 🙂

17 comments

  • Boohoo Bagholder

    Long suffering BOO holder here. I am starting to wonder whether now might be the time to just throw the towel in on it. The big problem as far as I can tell is the botched expansion into the US. The 28% revenue decline in this region was brutal and was likely responsible for wiping out any profit the rest of the business made. Can the US operation be turned around? I fear in the short-term, probably not. Unfortunately, Boohoo are likely spending a lot of money building up their logistics presence here, and the fear is are they shovelling good money after bad?

    I feel like there are two scenarios open. Option one is that management just give up on the US and refocus on the UK/Europe and take the huge write-off. Option two is that they plug on and try to make it work. In that scenario, I cannot see how they cannot avoid a rights issue. The current environment is lousy, and it’s not getting any better any time soon. As you say, now is not the time you want to go to the market to tap shareholders for more money.

  • Great podcast as ever Paul. Its a difficult time for everyone in this game and I personally think we are in for a rough ride for another 6m or so. I’m thinking this is really quite equivalent with the position back in 1974 where the oil price x8. Actually, the gas price is x15, so it’s worth given there is also an asset bubble deflating as well. If its similar to the early 70s then we may be in for another 50% leg-down. Hope not, but prepared all the same. Thereafter, things will hopefully jump back strongly, particularly for small-caps.

  • Thank you Paul for another interesting Podcast on Saturday.

    Just one question. Around 38 minutes you mention “holding on” to most of your big losers which I take to include £BOO.

    Given the amount of cash BOO are burning through I am getting more and more nervous that BOO may be heading to zero.

    I am 88% down but things do not look good. I feel I have been asleep at the wheel on BOO.

  • Jonathan Merrick

    Excellent podcast Paul as usual. On Renold, although I am bullish on the operational side of things, for the reasons you mentioned, the pension scheme deficit (greater than the marked cap of the company!) scares me off.

    Eurocell and Cambridge Cognition both look interesting.

  • Thanks for the latest informative podcast. Particularly grateful for the honesty in your personal investment performance. Read someone over the weekend that some (many?) private investors are liquidating their portfolios. My experience over several decades of investing is that there is nothing particularly special or unique about the latest downturn. Whilst the past is not a guide to the future, there is an element of reasonance across the decades, which leads me to focus on individual company fundamentals, whilst being alert to the macro factors.

  • richard angel melford borley

    Hi Paul,

    Great podcast as usual, thank you.
    I too would welcome a reasones Paul Scott ” buy?watch list” if you can find time.

    R

  • Thanks Paul,

    Another excellent summary and very good to stand back and reflect on the broader trends, keys risks etc.

    What would be brilliant if one time you might summarise your “watch list” (including current holdings where you might consider adding) and call out their respective Bull and Bear points for each for listeners to comment, and perhaps share their own names which excite them most and why?

    I did read about helping to contribute to your costs of this platform but couldn’t recall how, so instead have made a gift via the link to support ZANE (which it’s not clear BTW whether this attracts gift aid?).

    Thanks

  • Interesting podcast, but very naive about the problems facing the U.K. economy, IMO

  • On the subject of companies that have fixed their energy costs, Chamberlin (CMH) announced in their trading update of 8th July 2022 that “This recovery is further supported by the Group’s protection from any current or medium term energy price increases, having secured a 5 year fixed price contract for electricity in March 2020, placing the Group in an increasingly competitive position to win new orders.” Looks like they caught the low.

  • Great podcast once again. You mentioned threads to resilient and turnaround compilation screens. Where can I find these?

    Many thanks

  • Another great podcast Paul, very enjoyable to listen to and a very relaxed style.

  • Brilliant to have this up so early on a Saturday in time to listen with my morning coffee! Thanks Paul, I listen every week and am always both informed and entertained by your thoughts.

  • Jolly good as usual. Thoroughly enjoy your podcasts and stocko

  • Thanks Paul. You are certainly not an idiot and it gave me a chuckle at the end when you unexpectedly said that you don’t give a….. I like your honest and laid back style, and the willingness to stick your head above the parapet to give an opinion. From my perspective I’ve now started to try and pick up some high dividend paying stocks (whilst still holding my more growthy small caps) where I hope the divi will be sustainable and where I perceive there to be the potential for some reasonable capital upside. I don’t know if this is the right thing to be doing necessarily, but I’ve realised psychologically for me it benefits to see something coming in whilst most other things are dropping or doing nothing.

  • Thanks Paul for the podcast & really good blend of stock re-caps as well as Marco and broader thoughts.

    Here is what you covered in terms of stocks, topics and timings.

    Intro & YTD Returns
    DNL & Takeover bids – 1:98
    REVB – 3:97
    JOUL – 4:57
    BMS – 6:38
    CBOX – 10:00
    SHOE – 12:15
    FUL – 13:28
    ESKN – 14:34
    CARR – 15:30
    COG – 16:36
    LOOP – 17:15
    CAM – 18:30
    ECEL – 19:05
    SHOE – 20:51
    TED – 21:34
    ALM – 22:35
    Marco & Energy – 22:44
    Pricing Power & Non-discretionary Products – 34:00
    Value For Money Products – 35:28
    Charity – 36:30
    Keeping Cheerful & Coping – 38:00

    • That’s amazing, thanks James! I’ll mention your running order comment in the main article. Much appreciated, Paul.

  • As luck would have it, I’ve literally just this moment met a chap who used to work at OFGEM! He reassured me, saying rest assured, there are lots of very bright people in the civil service working out solutions to the energy crisis.

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