Good morning! Plenty of news announcements today, and we also have the ongoing issue of the plummeting oil price, and general market volatility to contend with - the US markets seem to be going a little wobbly again, and that always spills over into UK markets too. The FTSE 100 Futures are indicating an open down 60 points to 6,235. No doubt the heavy weighting of oil & resource stocks distorts the FTSE 100 - personally it's not an index that I find useful, so I tend to follow FTSE Intl-aim All Share Index (FTSE:AXX) and FTSE Smallcap Ex Investment Trusts Index (FTSE:SMXX) more closely, which are much more relevant to small caps.

Small caps indices are rapidly approaching the year's lows, hit in mid-Oct 2014, so not a happy time to be a small caps investor. Still, that's when the buying opportunities crop up!


MySale (LON:MYSL)

Share price: 173p
No. shares: 150.6m
Market Cap: £260.5m

This is a Philip Green -backed fashion company, which has a very interesting business model of doing flash sales online of surplus stock. Another interesting twist on that idea is to swap out of season stock from Australasia to Europe, thus in theory clearing surplus summer stock at the end of one hemisphere's summer, in the other hemisphere's start of summer.

I've kept my distance from this share so far, as the valuation looked far too ambitious for something that isn't really commercially established as consistently profitable yet.

Profit warning - today indicates that sales in the 5-months to 30 Nov 2014 are only up 4% year-on-year. That's terrible for a supposedly fast-growth internet retailer! The problems seems to be Australia, which is the main established market that MySale currently has. Others, such as UK &USA are recent start-ups.

On profits, the company says;

548e9125caac9MYSL.PNG

My opinion - This looks like a bad miss, both in terms of profits, and turnover. Stockopedia shows broker consensus for 47% turnover growth. So that the company has only managed 4% in H1, and is talking about getting into double figures for the full year (so presumably in the teens?), looks pretty bad.

I expect MySale shares are likely to take quite a hefty hit today. Although as we've…

Unlock the rest of this article with a 14 day trial

Already have an account?
Login here