Thomas Cook: What am I missing?

Thursday, Dec 20 2012 by

Hello Guys, being new to the topic of investing and the research into a company that comes with it, I see here a share of Thomas Cook that is confusing me. 

Brilliant advances in the share price while profits tank away, debt stays high, revenue is generated by having elements of sales to leaseback activity which means less free cashflow in the future and the list goes on. Not to forget a slain on book value less than half from 2011 and being at even roughly a quarter what the company has been 2010. Then finally the cut back of a dividend for me is the cherry on top.

So I do wonder whether I am missing something or have a too pessimistic idea of the company. As mentioned I am new to the topic and I am happy for every slap in the neck that helps me to understand the situation better for the future. Thank you in advance!


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Thomas Cook Group plc is a holiday company. The Company's segments are United Kingdom, Continental Europe, Northern Europe and Airlines Germany. Its hotels and resort brands include Sentido, Sunprime, Sunwing, Sunconnect, Smartline and Casa Cook. It has airline operations in Belgium, Scandinavia and the United Kingdom. It has a fleet of over 90 aircraft under the Thomas Cook Airlines and Condor brands. It operates from approximately 20 source markets in Europe and China. Its Sentido brand has operations in Germany, Austria, Switzerland, Belgium, Hungary, Poland, Netherlands and Czech Republic. Its Smartline brand has operations in Germany, Austria, Switzerland, Belgium, Hungary, Poland, Netherlands and Czech Republic. Its Thomas Cook brand has operations in Germany, Austria, Switzerland, Belgium, Hungary, Poland and Netherlands. Its Sunprime Hotels brand has operations in Germany, Austria and Switzerland. Its Neckermann brand has operations in Germany and Austria, among others. more »

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2 Posts on this Thread show/hide all

Ben Hobson 20th Dec '12 1 of 2

Hi! I'm by no way an expert on the detail of Thomas Cook but considering that a year ago (indeed as recently as March this year) the industry, and the company, was raising the serious prospect of it going bust, something's gone right. Harriet Green arrived as CEO in the summer and there seems to be some belief that she's getting a grip of the situation. But she's got some serious work to do. You're right, the numbers are really messy at the moment.

As for the recent price rise, a load of brokers, including Morgan Stanley and UBS, uprated the stock in early December. That combined with director dealings and a couple of institutions buying the stock, could be the answer there.

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A1ex99 23rd Dec '12 2 of 2

The quality indicators aren't great- I took a punt on them late last year and bought a few thousand of them whilst they were around 13p. Sold them off in August this year but regret doing this now as they are at 45p.

IMO I doubt that they will be going back down to where they were but it is a risky stock nevertheless.

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