Today I'm going to talk about a more niche ** - Disu Fashion, which was recommended by an enthusiastic netizen last year, and I wanted to take a look, but because I was too busy, I didn't have time to take a closer look until recently.
After reading it, I probably learned that this company is mainly engaged in the design, promotion and sales of high-end brands, and has created four well-known clothing brands such as "Dazzle", "Diamond Dazzle", "D'zzit" and "Razzle" since its establishment, and has formed a multi-dimensional and in-depth penetration of the fashion field. Frankly speaking, I don't have much interest in the women's clothing industry, firstly, because I lack too much understanding of the best brand, and I don't have my own subjective feelings about which is better or worse, and I am easy to be led by the company's publicity; The second is that clothing design is a business about creativity, figuring out consumer minds and even requiring extensive personalization, which is a bit similar to content production (even more difficult than content production to cater to consumer psychology), except for a few luxury brands or exclusive brands, it is not easy to establish a solid moat.
However, if you only look at the technical graphics and financial statements, there are certain bright spots in the company. First of all, from the technical chart, we can see an obvious large bottom divergence at the monthly level, while the stock price is at a new low, the MACD not only does not have a new low, but the center of gravity continues to rise, and the phenomenon of over-falling is becoming more and more serious. At the same time, the company has not been hyped since its listing, and it is conceivable that there are not many historical floats in the world. Secondly, the company's PE value and PB value are not high, the rolling PE is about 14 times, and the PB is only 164 times and a dividend yield of up to 562%, at least on the surface, gives the impression that the valuation is low.
In addition, in the five years since its listing from 2018 to 2022, the average ROE of Disu Fashion can reach 1858%, the return on equity is not bad, and the quality of earnings is very high. From 2014 to 2022, the company earned a total of 486.9 billion net profit, but created 5.5With a net operating cash flow of 4.5 billion, the operating cash flow can completely cover the net profit, which can be regarded as real material. At the same time, the cumulative capital expenditure for the period was only 86.8 billion, accounting for only the ratio of net profit and operating cash flow. 65%, which belongs to the high cash flow and low capital expenditure model, which is fully in line with the basic characteristics of cash cows.
Because of this, the company appears to be very rich on its books. From the balance sheet of the third quarter report of 2023, it can be seen that the company's monetary funds are 22600 million, and another 74.2 billion in transactional financial assets, and the total of the two types of cash assets is about 300.2 billion yuan, accounting for 66 percent of total assets18%, which is quite impressive.
The above data shows that the business of Disu Fashion is not bad, at least it can be called a profitable company, which is the main reason why it can provide high dividends to shareholders. For this reason, I specifically consulted some friends of the opposite sex around me with great interest, hoping to learn about its brand reputation, but it is a pity that some people have bad reviews, some people have no feelings, and some people think it's okay, and I really can't get a public opinion that has too much value. This phenomenon can only be said to have a weak erosion effect of brand influence on consumer minds.
However, the gross profit margin of Disu fashion is very high, more than 70% (or even more than 75%) all year round, which can be said to be a rare existence in A-shares. Since it has been able to maintain a high gross profit, it means that the company still has a certain brand premium ability, after all, the positioning of high-end is not something that can be achieved by thinking about it casually, and the competition threshold may not be strong but it does not mean that there is no at all.
To sum up, for such a company that can make real money, can provide high dividends, has a low valuation, and has oversold signals on technical graphics, it is indeed quite good among the many big A**. However, the company also obviously has some hidden concerns, if from the perspective of long-term investment, it must be taken into account, and we will continue to talk about the problems of vegetarian fashion in the next article, please continue to pay attention. (To be continued).
Risk Warning: The views mentioned in this article only represent personal opinions, and the subject matter involved is not recommended. ）