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Cashbuild Limited

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$JSECSB - Cashbuild: Two Technical Reasons For Bullish OutlookSee link below for previous analysis. Cashbuild has been trading in a falling wedge pattern for over two years but the April 2024 low could be significant. There are two technical reasons for optimism in Cashbuild: 1) Price looks to have broken out of the wedge pattern, though without much acceleration. 2) The MACD has been converging with price since October 2022 and is now holding above the zero line. I will maintain a bullish stance above the key invalidation level of 12150.
JSE:CSBLong
by Loyiso_BlaqueSoros_Mpeta
Our opinion on the current state of CASHBIL(CSB)Cashbuild (CSB) is the largest retailer of building materials and related hardware in Southern Africa, focusing primarily on the home improvement market. In the context of the currently depressed economies in the region, much of the company's growth has been driven by the opening of new stores. This strategy positions Cashbuild to survive the economic downturn and benefit from any general recovery in Southern Africa's economic conditions. In its results for the six months ending 24th December 2023, the company reported a revenue increase of 2%, while headline earnings per share (HEPS) decreased by 20%. The company's net asset value (NAV) fell by 16% to 7757c per share. The company noted that revenue from stores that existed prior to July 2022 (312 stores) increased by 1%, and its nine new stores contributed an additional 1% to growth. However, the gross profit margin decreased slightly from 25.3% to 24.7%, with selling price inflation at 3.2% by December 2023 compared to the previous year. In a subsequent update on the third quarter ending 31st March 2024, the company reported a 3% increase in revenue, with the nine new stores again contributing 1% growth. Selling inflation during this period was 2.4%. By the fourth quarter ending 30th June 2024, Cashbuild reported a 4% revenue increase compared to the same quarter of the previous year. For the full financial year, existing stores contributed a 3% revenue increase, while the 12 new stores added 1% growth. In a trading statement for the 53 weeks ending 30th June 2024, Cashbuild estimated that HEPS would decrease by between 20% and 30%. Technically, the share experienced a steady downward trend from March 2018, bottoming out at R120 per share in March 2020. It subsequently rose to R337 in February 2021 before beginning another downward trend, with the current price around R164. The stock is now trading at a P:E ratio of 15.19 and offers a dividend yield of 3.2%. Cashbuild is widely regarded as an extremely well-managed company, well-positioned to capitalize on any future improvement in local economic conditions. However, it operates in a tough and highly competitive industry, and even at current levels, it may still appear a bit expensive.
JSE:CSB
by PDSnetSA
Our opinion on the current state of CASHBIL(CSB)Cashbuild is the leading retailer in Southern Africa for building materials and hardware, primarily focusing on the home improvement market. The company's growth strategy in the region, characterized by slow economic activity, primarily revolves around expanding its store footprint. This expansion is viewed as a positioning strategy to capitalize on any potential recovery in the broader economic environment of Southern Africa. For the six months ending on 24th December 2023, Cashbuild reported a modest revenue increase of 2%, but experienced a significant reduction in headline earnings per share (HEPS), which decreased by 20%. Additionally, the company's net asset value (NAV) declined by 16% to 7757 cents per share. These financial indicators reflect the challenging conditions in which Cashbuild operates. The company noted that while revenue from pre-existing stores (312 stores existing before July 2022) saw a slight increase of 1%, the nine new stores also contributed a 1% increase to total growth. However, despite stable gross profit levels, the gross profit margin percentage decreased from 25.3% to 24.7%. This margin contraction was alongside a modest selling price inflation of 3.2% as of December 2023 compared to the previous year. In its update for the third quarter ending 31st March 2024, Cashbuild continued to report revenue growth, albeit limited to 3%, with the nine new stores again contributing 1% to this growth. Selling price inflation was slightly lower at 2.4%. These figures suggest ongoing efforts to manage costs and pricing in a tight economic context. From a technical perspective, Cashbuild’s shares have experienced significant volatility. The stock was on a downward trend from March 2018, hitting a low in March 2020 at R120 per share. It then saw a substantial rise to R337 in February 2021, before entering another downward trend. Currently priced at R143.50, the stock trades at a P/E ratio of 13.29 and offers a dividend yield of 3.66%. Despite Cashbuild's strong management and strategic positioning to leverage any economic upswing, the company operates in a highly competitive sector that demands continual adaptation to market forces and consumer behavior. Although the share price has seen declines, making it more accessible, it still presents as somewhat pricey given the broader market conditions. Potential investors should weigh the robust management against the operational challenges and market position before considering an investment, especially in light of the competitive pressures and economic uncertainties prevailing in Southern Africa.
JSE:CSB
by PDSnetSA
Our opinion on the current state of CSBCashbuild, recognized as the leading retailer of building materials and related hardware in Southern Africa, focuses on the home improvements market. Given the economic downturn in Southern Africa, the company's strategy for growth has largely been centered around the expansion of its store network. This approach indicates Cashbuild's preparation for enduring the current market challenges and positioning itself to capitalize on any potential upturn in the region's economic climate. For the six-month period ending on 24th December 2023, Cashbuild reported a modest revenue increase of 2%, whereas its headline earnings per share (HEPS) saw a significant decrease of 20%. Furthermore, the company's net asset value (NAV) experienced a notable decline of 16% to 7757c per share. The revenue from stores operating before July 2022 (312 pre-existing stores) saw a slight increase of 1%, with the addition of nine new stores contributing another 1% to the growth. Despite maintaining gross profit levels, the gross profit margin percentage decreased from 25.3% to 24.7%, influenced by a selling price inflation of 3.2% at the end of December 2023 compared to the previous year. From a technical perspective, Cashbuild's share price has seen significant fluctuations. After a steady decline starting in March 2018, the share price found its low at R120 in March 2020. It then experienced a notable rally to R337 by February 2021 before entering another downward trend. Currently trading at R131.58, with a price-to-earnings (P:E) ratio of 10.77 and a dividend yield of 4.45%, Cashbuild demonstrates the characteristics of a well-managed entity with a strong potential for growth, particularly if the Southern African economic landscape improves. Despite its commendable management and strategic positioning within a challenging and competitive industry, the valuation still seems somewhat steep given the current market conditions. Potential investors might consider this aspect carefully, weighing the company's growth prospects against the backdrop of the broader economic environment and industry competition. Cashbuild's future performance will likely hinge on its ability to navigate the economic recovery of Southern Africa and leverage its expansion strategy to drive further growth.
JSE:CSB
by PDSnetSA
Cashbuild Showing Signs of Trend ReversalCashbuild is in pursuit of a weekly and yearly low price, here we see price finding support at the 0.382 line of the Pitchfork bouncing off it. In the process it has created hidden divergence on the TSI & RSI indicators. We can open a long position when price closes above the 10 week moving average, more risk accepting investors can go long on weekly swing low. Ideal to harvest some profits when we reach the resistance of the Pitchfork but we will be assessing these moves on a daily chart timeframe.
JSE:CSBLong
by runyamhere
$JSECSB - Cashbuild: New 52 Week Low, Still WedgingSee link below for previous analysis On Tuesday, Cashbuild released a Trading statement ahead of the interim results for the 26 weeks ended 24 December 2023. Headline earnings per share (HEPS) are expected to decrease between 15% and 25%. The DIY sector in SA continues to struggle and there is little to signal a change in the fundamental outlook. Technically, the stock is still trending downwards in a large falling wedge. My short-term price target is at the lower support line which could see price falling to 10000 cps.
JSE:CSB
by Loyiso_BlaqueSoros_Mpeta
Our opinion on the current state of CSBCashbuild, the premier retailer in Southern Africa for building materials and related hardware, focuses on the home improvement market. Amid the current economic downturn in Southern Africa, Cashbuild's growth strategy primarily revolves around the expansion of its store network. This approach is a clear indicator of the company's intent to not only survive the challenging times but also to position itself to capitalize on any potential economic recovery within the region. For the fiscal year ending on 25th June 2023, Cashbuild reported a 4% decrease in revenue and a significant 38% decline in headline earnings per share (HEPS). The company detailed that revenue from stores operating before July 2021 (termed pre-existing stores, totaling 308) fell by 6%, whereas revenue from 10 new stores contributed a 2% growth. Additionally, there was an 8% decrease in gross profit, with the gross profit margin percentage dropping from 26.3% to 25.4%. The period ended with a selling price inflation of 5.4% compared to the previous year. In the operational update for the quarter ending on 30th September 2023, Cashbuild reported a 2% revenue decrease from its 312 existing stores, which had been operational before July 2022, while 8 new stores added a 2% growth. Transaction levels remained steady, with existing stores experiencing a 2% decrease and new stores contributing a 2% increase in transactions for the first quarter. The second quarter update to 24th December 2023 highlighted a 5% revenue increase, with sales from the same stores rising by 3%. Cashbuild inaugurated 9 new stores, increasing the total to 321, and noted a selling inflation rate of 3.2%. Transaction volume through the tills saw a marginal 1% increase for the group during the second quarter, with existing stores recording a 1% decrease and new stores adding a 2% increase. In its trading statement for the 26 weeks ending on 24th December 2023, Cashbuild anticipated a HEPS decrease of between 15% and 20%. From a technical perspective, Cashbuild's share price experienced a consistent downward trend starting in March 2018 but found a nadir in March 2020 at R120 per share. The share price enjoyed a surge to R337 in February 2021 before entering another downward trajectory. Currently priced at R144, with a P/E ratio of 11.79 and a dividend yield of 4.07%, Cashbuild demonstrates the hallmarks of a well-managed entity poised for growth upon any economic upturn. However, given the competitive nature of the industry and the company's current valuation, it appears slightly overpriced at present levels, suggesting a cautious approach for potential investors.
JSE:CSB
by PDSnetSA
Our opinion on the current state of CSBCashbuild (CSB) is the largest retailer in Southern Africa of building materials and related hardware, concentrating on the home improvements market. In the currently depressed economies of Southern Africa, most of the company's growth comes from opening new stores. Clearly, this is a share which is positioning itself for survival and to benefit from any general recovery in economic conditions in Southern Africa. In its results for the year to 25th June 2023 the company reported revenue down 4% and headline earnings per share (HEPS) down 38%. The company said, "Revenue for stores in existence prior to July 2021 (pre-existing stores - 308 stores) decreased by 6% and our 10 new stores contributed 2% growth. Gross profit decreased by 8% with gross profit margin percentage decreasing from 26.3% to 25.4%. Selling price inflation was 5.4% at the end of June 2023 when compared to June 2022." In an operational update for the 3 months to 30th September 2023 the company reported, "For the 312 existing stores (in existence prior to July 2022), revenue decreased by 2% and the 8 new stores contributed 2% growth. Transactions also remained at similar levels when compared to Q1 FY2023, with existing stores decreasing by 2% and new stores contributing 2% to the first quarter." In an update on the second quarter to 24th December 2023 the company reported revenue up 5% with same store sales up 3%. The company opened 9 new stores bringing the total to 321. Selling inflation was 3,2%. The company said, "Transactions through the tills during the second quarter for the Group increased by 1% (half year: flat) to that of the comparative period, with existing stores decreasing by 1% (half year: 1% down) and new stores contributing 2% (half year: 2%)." Technically, the share was in a steady downward trend from March 2018 but bottomed out in March 2020 at just over R100 per share. It subsequently rose to R337 in February 2021 before beginning a new downward trend. It is now at R168 and on a P:E of 13,75 and a dividend yield of 3.49%. Cashbuild is an extremely well-managed company and well-positioned to take advantage of any improvement in local economic conditions, but it is in a tough and highly competitive industry. It still appears a little expensive to us at current levels.
JSE:CSB
by PDSnetSA
$JSECSB - Cashbuild: Still Dipping, But Now WedgingSee link below for previous analysis Little has changed from a fundamental perspective and the share price has continued to trend lower. Price is now trending in a falling wedge pattern which can be viewed as bullish once price breaks out of the wedge, ideally on high volume. What is key for the five wave advance from 7000 to 34599 to remain valid is for price to hold above 7000. I will maintain a bearish stance until I see clear reversal signals.
JSE:CSBShort
by Loyiso_BlaqueSoros_Mpeta
Our opinion on the current state of CSBCashbuild (CSB) is the largest retailer in Southern Africa of building materials and related hardware, concentrating on the home improvements market. In the currently depressed economies of Southern Africa, most of the company's growth comes from opening new stores. Clearly, this is a share which is positioning itself for survival and to benefit from any general recovery in economic conditions in Southern Africa. In its results for the year to 25th June 2023 the company reported revenue down 4% and headline earnings per share (HEPS) down 38%. The company said, "Revenue for stores in existence prior to July 2021 (pre-existing stores - 308 stores) decreased by 6% and our 10 new stores contributed 2% growth. Gross profit decreased by 8% with gross profit margin percentage decreasing from 26.3% to 25.4%. Selling price inflation was 5.4% at the end of June 2023 when compared to June 2022". In an operational update for the 3 months to 30th September 2023 the company reported, "For the 312 existing stores (in existence prior to July 2022), revenue decreased by 2% and the 8 new stores contributed 2% growth. Transactions also remained at similar levels when compared to Q1 FY2023, with existing stores decreasing by 2% and new stores contributing 2% to the first quarter". Technically, the share was in a steady downward trend from March 2018 but bottomed out in March 2020 at just over R100 per share. It subsequently rose to R337 in February 2021 before beginning a new downward trend. It is now at R147.29 and on a P:E of 12,06 and a dividend yield of 3.98%. Cashbuild is an extremely well-managed company and well-positioned to take advantage of any improvement in local economic conditions, but it is in a tough and highly competitive industry. It still appears a little expensive to us at current levels.
JSE:CSB
by PDSnetSA
Cashbuild about to crash to R100.00Right now it's anyone's guess. The market has been so illiquid with low volatility, that the only signs are pointing are down. Box Formation (but not a strong one as three supports and resistances have not touched). However, there is a range bounded movement with lower highs and very little confirmation of upside. It needs to break out of the downtrend before we look to any potential longs. Price<200 - BEarish RSI - lower highs - But classical range for RSI with low moving stocks. Target 1 will be to R100 Low probability trade ABOUT THE COMPANY Cashbuild is a South African retail company specializing in building materials and related products. Cashbuild was founded in 1978. Its first store was located in Pretoria West, South Africa. The company operates in the southern African region, including countries like South Africa, Namibia, Lesotho, Botswana, Swaziland, Malawi, and Zambia. Cashbuild operates over 260 stores across the regions it serves. The company follows a business model where they operate in both urban and rural areas, especially in the lower-income regions. This business model allows the company to reach and serve customers who might not have access to such stores otherwise. Cashbuild is known for being a one-stop-shop for a wide range of high-quality building materials, like cement, bricks, paint, timber, plumbing, and sanitaryware, at affordable prices.
JSE:CSBShort
by Timonrosso
$JSECSB - Cashbuild Ltd: How Much Lower Can The Stock Go?Since the last analysis on the 15th of February 2023, Cashbuild released an awful set of interim results on the 1st of March. Revenue (4%) Gross profit (9%) Operating profit (47%) Headline earnings (39%) The market did not react aggressively to these disappointing numbers but the share has continued to trend lower. There was not much of an outlook besides "Management expects trading conditions to remain challenging." The bear from 34599 is still trading around the lower channel trendline and the MACD zero-line rejection could be a leading indicator of another potential sell-off. It is difficult so see an improvement in operations in the short-term and the share price is not showing any reversal signals leading me to ask how much lower can the share go? This is a difficult question to answer as there isn't any clear support levels on the chart but at the same time it is maybe a little late to short. This is where fundamentals and valuations come in for investors. Investing.com Pro has a fair value of R229,47 which represents 33,8% upside.
JSE:CSB
by Loyiso_BlaqueSoros_Mpeta
$JSECSB - Cashbuild Ltd: Fundamentals Matter MoreCashbuild is still trading far from its all time highs of 2018. The post-covid-19 crash rally from 7000 to 34599 unfolded in five waves and the correction has been prolonged but contained within a descending channel. Technically, this calls for further upside and price is currently hovering above the golden ratio 61,8% retracement level. The fundamental picture looks grim though with Cashbuild having released a trading statement today for the interim results for the 26 weeks ended 25 December 2022. The company expects; EPS of between 647.4 cents to 712.1 cents, represents a decrease in EPS of between 45% and 50%; HEPS of between 678.2 cents to 734.8 cents, represents a decrease in HEPS of between 35% and 40%. The interim results for the 26 weeks ended 25 December 2022 are expected to be released on or about 1 March 2023. This should provide a lot more info and hopefully a short-medium term outlook. Until then, I sit on my hands on Cashbuild.
JSE:CSB
by Loyiso_BlaqueSoros_Mpeta