I Sold $39,000+ of LB Stock
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As some of you have speculated, we did sell all of the L brand shares. And we sold it all guys, everybody in my stock market membership group already knew this, but I just wanted to kind of tell you guys in my YouTube audience, because this was a big, big huge position of ours.
You know, we sold it all it was well over 30k worth, and it was a big position for us. So I just want to share with you guys in-depth, why over the last few weeks, we decided to sell all of our shares to get out of this company completely.
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I want to break it down to you, the more I held this stock, the more I started to resent it not because the stock wasn’t doing anything in the stock wasn’t doing anything. But because of the underlying problems.
I started to really see with this company that we’re going going more into depth and more into depth. So whether you care about elberton stock or not, I think today was video will help you tremendously.
At the end of the video also tell you like how much we actually ended up losing on that position, it was a losing position for us, unfortunately. So I will let you know at the end of the video how much we ended up losing.
But today’s video will help you in kind of understanding why I decided to sell out of this position. So there are four main points and what you’ll notice is all of these feed into something Okay, so the first point was vs sales were just crap.
You know, they just kind of kept going down, they look like they might recover a little bit, but then they would go down and they would go down. And this was continuous and even in the numbers they just reported today.
Which thank goodness we sold out, you know, yesterday and whatnot. The final steak we sold out yesterday. But even in today’s numbers they report it like you can see once again vs was weak across the board, especially in the physical retail stores.
So when I looked at this one, there was nothing that was reviving this company, they were trying to do all these of these things and whatnot. This is a huge part of their business. This is you know.
Viewed as as pretty much like half their business bath and Bodyworks has a huge chunk of it in vs is the other the other big half Okay, Pink is a smaller brand there which is a successful brand actually doing much better than the vs brand in general.
But the vs brand, it was just it was apparent that it’s not saveable in terms of meal. It’s just not it’s not salvageable in the way you know, you might think of this brand is it’s a very successful brand.
But I’ve seen nothing from management that makes it a standout and makes you say, wow, this is this is going to become big time again. Okay, so sales just kept getting worse and worse. All right.
Next part is they were revenue chasing, they were not profit chasing. And this is just another sign that I saw with the company where they’re just trying to get people through the door any way possible.
They were trying to do all these promotions all these deals and whatnot to try to get people into the vs side via sales were still somebody like unbelievably weak so the via sales are still super weak, your revenue Chase and trying to get people through the door doing any promotion you possibly can out there.
And that’s just a sign of short term ness, they just want to try to buff up the numbers a little bit this company reported numbers on a monthly basis which I think is really dumb in my opinion.
They should review just reporting numbers every quarter instead of doing these these monthly numbers are so short term and thinking like it’s ridiculous and they’re just trying to revenue Chase and meanwhile they’re not there they’re hurting their brand long term and that in this whole deal when you revenue.
Chase and you’re just trying to you know discount and get people free stuff and just give everything away you diminish the brand value there so instead of profit chasing state you know what the revenue numbers are going to be with the revenues numbers are you know.
If they’re down they’re down we’re going to make profits off our products we’re going to sell them for a premium price you know you can you can go after the revenue thing you know Apple could decide to cut all iPhone prices in half tomorrow.
And guess what sales of iPhones would explode but that would hurt the apples and brand ton over time okay if they just do it all let’s just blow out a ton of smartphones it would make the revenue numbers look good in the short term.
But as far as profit numbers it would it would just completely destroy them so vs was like we’re gonna revenue chase not profit chase I think it’s very short term and thinking I think is brand damaging long term Alright.
So I didn’t like that didn’t like vs sales are still continued to go down despite them revenue chase in every way they could all right. Also, this company was paid off all their profits, they were actually making their payments on dividends.
Almost pretty much every single penny this company will make in profit this year is going to be paid out in dividends. I think that is absolutely absurd. I think that is a very bad policy by the company.
They have yet to cut this dividend they want to just pay it is at a yield of seven plus percent right now it’s absolutely ridiculous. And they want to pay this huge dividend out and it’s like okay, you got no money left over at the end of the pie.
They’re gonna have no money left over to do anything else. Okay, you can’t pay off debt, you can’t expand you know, expand into different places and whatnot do those type of things. Otherwise you have to take out more debt and add that debt balance up even more Okay.
So they can’t do anything because all the profits this company’s making, they’re just paying them out and dividends and it’s not doing anything for the stock is it hasn’t put a floor under the stock.
Meanwhile, they could have been using this this money you know, for a lot of different reasons. Okay, a lot of different reasons, remodel in the stores, expand even bigger online. Expanding social media presence doing even more advertising all of this this this profit money could be used for those type of things.
But instead they’re like dude we don’t know how to grow though we don’t know how to grow the business we’re just gonna pay all this money out to you shareholders in the form of dividends I’m like.
Like like that is a bad sign as a company like like no we can’t keep this profit we’re just gonna pay it all out to you pretty much literally almost every single penny this company makes in profit will be paid on dividends this year.
We can’t grow the money Who’s here? Here’s it to shareholders. That’s a bad sign man that’s a bad sign. A great company knows how to reinvest those those profits the company makes into other things to make more and more profits when you’re just paying out there’s nothing wrong with paying out dividend I don’t mind that at all.
But make it a reasonable rate don’t pay out every dime you got pretty much coming in in dividends is absolutely ridiculous. absolutely ridiculous. All right. Now the bad thing I saw was a management is is in a place in a state of mind right now.
Where they are almost in disbelief that they are like delusional almost, I would almost call them management in delusional state right now, when I listen to these conference calls. They they almost like they sound like everything’s just going hunky dory and everything’s gonna be okay with but when you look at the numbers.
They just get worse and worse. These numbers they reported today, were probably the worst I’ve seen of out of the vs side, especially those bounce around 6% physical stores around 4%. Online.
I’m like these numbers are extremely weak management is delusional, okay. And they went away from so many things that brought customers in as far as the swimsuit side of the business, as far as catalogs and things like that.
They went away from so much. So many of those things that were historically successful, that management’s just in complete delusion with this company, and I don’t think they have woken up to the fact that man we like, like, we need to get it together at this company.
Guys. It’s a bad it’s bad, what’s going on there? Other than bath and Bodyworks? Like everything else is like not good with this company right now. Okay. China expansion, although they’re expanding.
They’re, you know, it’s not going the way it shouldn’t be going. It shouldn’t be, you know, sales should be off the hook there. They’re not okay. Especially the fact that they did the they did the full runway show in China last year, and seals still aren’t good.
And so what all this brought me back to is the fact that this is just a short term thinking company, okay. And I don’t like to be in companies that all they do is think about what’s going to happen next month, and next quarter, okay.
You needed to have a certain amount of focus around that. But the amount of attention like everything just draws back to short term thinking, the vs sales just keep going bad revenue, chasing stuff profit chasing in and maintaining that great brand long term.
They’re just trying to revenue chase at this point in time. It’s just a short term move to try to get people in any way you can. They hurt your brand long term. All the profits just been paid out in dividends.
Are you kidding me? That’s like the most short term in thinking thing out there. You’re telling me you can’t invest those those profits better, you just got to pay it all out to the shareholders.
It’s all just short term thinking management’s in complete delusion with this company, they think it’s gonna bounce back or something. And we’ve seen nothing but numbers actually get worse, especially on the vs side.
So when I look at everything, the company that a company’s decision making, it’s all short term in nature, the dividends is the biggest part of it. They paint out all your profits in dividends, why aren’t you doing a bigger buyback? If the shares are undervalued? here as a management team, you feel like they’re undervalued, why you’re not taking all that money that’s paid out in dividends and saying.
Hey, we’re gonna buy back massive amounts of shares of stock right now. Or we’re going to use that money to expand or pay down debt or things like that. No, no, no, no, let’s just make all the money we can and just pay down dividends like it’s absolutely ridiculous guys.
So needless to say, through all this, it’s a short term thinking company, I don’t want to be in it okay. And I started to resent the stock and the company in general, just because I continued to see nothing but short term behavior going on with the management I didn’t like that.
So we ended up taking about a 2k loss and this one, it could have been a little bigger, but we made a lot of dividend money. I remember one on one of my accounts alone, we got over $500 in dividends alone in that one.
So ended up being about 2k loss. I don’t like to take losses, you know, it stains it’s unfortunate as part of the game. But my thinking around this one was regardless whether it goes up or you know.
Let’s say it goes to 50 $60 over the next year great I’m happy for all l brands shareholders, I don’t want to make my money in a company that’s nothing but short term focus, there’s nothing you can prove to this company that other than their just have a short term little mindset going on.
And that’s the way this company thinks I don’t want to make my money in a short term thinking company and that’s all this company doesn’t have long term visions. They don’t have long term plans.
If they do, they’re just a bunch of BS. They’re clearly just focused on short term, you pay all your profits in dividends, you shoot your short term company and that’s what this is. I don’t want to make money that way.
And I don’t even know if that company will make money that way. Like, like good luck to you. If you own elgrand shares. I’m hoping for the best for you. I hope you make money on it.
As far as me like I’m more than happy to just take our 2k loss and get the crap out of that stock because I love the brands there. I love the brands vs. Bath and Bodyworks pink. I love those three brands.
They own But when a management team is focused on short term and that’s all they’re focused on, it’s not worth it for me to be in that So anyways, hope you guys enjoy this. If you love stock market news, check out my Instagram I always post a ton of stuff there, and especially in the Instagram stories. Thank you for watching. Have a great day.