The Mail on Sunday
Hold on as Fox fights back at pallid HMV
MIDAS recommended shares at the beginning of this year when they were 95p. The stock was 250p five years ago but the stock market became increasingly concerned about HMV losing out as consumers opted to buy goods on the internet.
The company, which owns Waterstone’s and several live music venues as well as the HMV chain of DVD and music shops, has indeed been hit by the growth of book and music sales over the internet.
But chief executive Simon Fox is fighting back and last week issued a strategy update, telling investors how he plans to develop the company over the next few years. Fox intends to revitalise Waterstone’s, expand the live music division, sell more books and music online and broaden the range of products at HMV, including video games and ultratrendy fashion items.
The group’s financial year runs to the end of this month and profits are expected to rise from £63 million to about £73 million and £80 million next year. The dividend is forecast to stay at 7.4p, putting the shares on a yield of 8.7 per cent.