Added to YB: 2024-05-29
Pitch date: 2024-05-28
CARD.L [neutral]
Card Factory plc
-23.55%
current return
Author Info
Company Info
Card Factory plc operates as a specialist retailer of cards, gifts, and celebration essentials in the United Kingdom, South Africa, Republic of Ireland, the United States, and internationally.
Market Cap
GBP 361.9M
Pitch Price
GBP 0.92
Price Target
N/A
Dividend
4.66%
EV/EBITDA
4.56
P/E
8.39
EV/Sales
1.01
Sector
Specialty Retail
Category
value
Card Factory's Financial Puzzle: Lease Costs and Free Cash Flow Reassessment
CARD.L: Sold position after realizing lease accounting was aggressive. Annual lease cash costs ~£40-45M, not discounted balance sheet number. At £390M EV, now trades at 9-11.5% FCF yield vs prior 17-25% estimate. Growth now needed for thesis to work vs prior view of stable FCF in slightly declining industry. Concerning 8% card volume drop in 2023. Still interesting but no longer a clear bargain. Appreciate feedback!
Read full article (4 min)