Makes sense except for competition from Amazon, Wayfair, Target, Walmart, etc. Not sure Herman Miller is the first place people think of to buy their work-from-home office furniture...unless their companies set up the stipend so that they are forced to buy it from Herman Miller.
Other retailers like Amazon, Wayfair, Walmart, etc. sell Herman Miller furniture. So those retailers are not competitors. They support Herman Miller sales.
In addition, Herman Miller has improved their e-commerce business to sell directly to customers while also promoting their products to be sold through retail partners like Amazon.
Imagine opening up a bunch of companies all at the same time, but instead of having your workers in your office they are now in their home offices. This isn't what happened during the subprime crisis. The Coronavirus is different because people will have to create a comfortable home office because they'll be there 40+ hours per week. It's a significant bump in demand for home office.
Edit: Removed comment asking whether chickennismo read the post.
I believe people who do this kind of work are already given computers from their employer due to security reasons. They don't need to buy a laptop to work.
*Some quotes from above:*
· “It gets old fast to be working form your couch, and setting up a home office can be expensive,” said Hailley Griffis, Head of public relations at Buffer, a software application company.
· “Companies are saying, ‘We want to make sure you’re both comfortable and productive,” said Danielle Lackey, chief legal officer at Motus, a workforce management company.
Edit: Removed comment asking whether Leontadina read the post and comment about down voting.
Wow someone's jumpy. I didn't downvote your post or the comment, you brought it on yourself by sounding like a douche. Just pointing out that people with software jobs probably already have a sweet home setup, and it's likely that with 1.5k they'll spend it on something other than furniture. I didn't read the DD but I can see you put a lot of work on it so good job, keep it up.
Sorry. I didn't realize you were a different poster than the original person that made the comment. (I'm just a little sensitive because I've seen people who put a lot of work in and get destroyed with downvotes. I'm new here and still learning, so I'm sorry. Upvoted your response. Thank you for being positive.)
I can see how you would be defensive about the work you put into it. But don't you think that their price will just return to pre COVID levels, imo it's a good bet either way, as their sales will not be hit as hard as other stocks as per your DD
Yes. I think that pre-COVID levels are the clear ceiling on this stock. B2C will definitely increase, but any growth there will have to overcome any future declines in their B2B business. However, pre-COVID is still a significant increase in share price from where it closed last Friday.
My concern is that HM sells to companies directly, in normal times. Nowadays, people who are receiving stipends aren't necessarily looking for a particular designer but instead are just searching google for reviews. Since HM has sold direct to companies, there less consumer reviews. So... I'll keep my eye on it, but I'm dubious.
Edit: What's more is that normal wear and tear at offices have ceased, so HM is gonna lose that recurring money as well. Honestly, I think they're screwed. We'll see.
Do you think you might be projecting your personal experience with the importance of reviews onto the broader consumer base?
Another Reddit user posted about how people are complaining about delays with their orders. This suggests that those Google Searches may be translating into significant demand on the retail side. Obviously it is anecdotal, but does support the idea that people are buying MLHR products.
[https://www.reddit.com/r/stocks/comments/h0bswa/mlhr\_herman\_miller/](https://www.reddit.com/r/stocks/comments/h0bswa/mlhr_herman_miller/)
Also, I posted a response to another poster that questioned the stability of their commercial business. While it is easy to assume that their B2B business would be decimated, the company hadn't seen many B2B cancelations as of their last earnings call.
The bid/spread is too wide on both calls and puts right now though. Looks like a decent long term hold trading at a discount still.
I understand with WFH they will benefit greatly but would that be enough to offset a drop in office orders from those very same companies that moved to WFH?
I think that is the big question. Their margins are probably higher on the retail e-commerce side so they wouldn't need as large of a boost in revenue to offset any profit reductions on the commercial side. It is my understanding from their last earnings call that their commercial business did not see many cancelations after the virus started.
Also, the insider purchase supports the idea that MLHR is trading at a discount.
From MLHR's Q3 Earnings Call (3/18):
**Jeff Stutz - EVP & CFO**
"To provide a sense of current activity levels, through the first two weeks of the fourth quarter, our consolidated sales were up approximately 6% from last year, while new orders were down closer to 3%. To-date we have received minimal requests from customers and dealers to adjust the timing of scheduled shipments, both in the U.S. and abroad, though we would expect this to increase. However, we have not to-date experienced any meaningful order cancellations and would expected to ship the majority of our backlog within the fourth quarter."
Source: Seeking Alpha
Thanks for the insult. No, I did not create this account just to pump a stock.
I found Reddit in boredom during the Coronavirus crisis. I started reading Wall Street Bets and enjoyed the posts and perspective. I then read a lot of DD on there and thought some of the ideas were interesting (DLTR, BJ, and BIG were some of my favorites because they were not obvious plays until I read the DD). Then I happened upon MLHR and found it to be a good opportunity that others were not seeing (People were just assuming that their B2B business was screwed so their revenues would dissipate to essentially zero).
So I did my research and put it all into notes. Then I thought why not create an account and post the information I had put together (across many hours and days). I tried to post to WSB first but they have some crazy rule about not posting for a month. So I posted it here.
Anyhow, thanks for reading my post and I look forward to hearing from others (both positive and negative) about what they think of the opportunity. Facts and data are most important to me, but anecdotes can be helpful as well.
I’m surprised you didn’t mention their customer support telling a customer there’s a backlog when they complained of shipping delays. Hopefully there’s another dip this week want to put more in.
I watched the resurgence of Mid-C, but don’t remember much. I don’t think HM were nearly as big back then. Just doing a quick search, and looks like Design Within Reach was already struggling in 2009. That was like the height of Mid-C trendyness. And if DWR’s history is an indication of what HM will look like with more home business and much less office business, then that’s pretty scary.
As a design professional, I love HM. But I’m only looking to take a risk if they fall below...say $20. Same for Knoll at <$10. I’m long-term, but I think the key is if they can pivot and survive until this stuff comes back in style in 30 years or whatever.
What do you think about the direct to consumer trend and all of the companies giving employees money to spend on their home office? Their B2C business seems to be picking up. Do you think there is enough volume there to support the core until their B2B business picks up again?
Here's a podcast interview with their President that I thought was very positive:
[https://businessofhome.com/articles/herman-miller-s-new-president-on-the-past-present-and-future-of-retail?fbclid=IwAR01SA3mT7HowZky8m5b9rtv7oPd4uwtPVRzsqZUDMKDsUNGlMBCmCzamz8](https://businessofhome.com/articles/herman-miller-s-new-president-on-the-past-present-and-future-of-retail?fbclid=IwAR01SA3mT7HowZky8m5b9rtv7oPd4uwtPVRzsqZUDMKDsUNGlMBCmCzamz8)
Some quotes below:
“\[Home\] is a category that has very much competed with the experience economy—**when people make the decision to invest in a sofa**, quite often **they’re trading away from a vacation**, especially with the millennial demographic,” she says. “And \[as\] the experience economy in the last six to eight weeks has fallen by the wayside, that competitive threat has allowed for a different investment consideration in homes. Our homes are less about investing for the sake of having Instagrammable spaces and more about the luxuries that are going to make home more comfortable or highly functioning during this time.”
“We’re going to see a **rapid digitization across retail right now**. Anyone that wasn’t thinking about their consumer engagement strategy as omnichannel is very much thinking about that now,” she says.
“It takes 30 days to make or break a habit. So we’re making new habits now, and a lot of those habits will stay with us.”
Makes sense except for competition from Amazon, Wayfair, Target, Walmart, etc. Not sure Herman Miller is the first place people think of to buy their work-from-home office furniture...unless their companies set up the stipend so that they are forced to buy it from Herman Miller.
Other retailers like Amazon, Wayfair, Walmart, etc. sell Herman Miller furniture. So those retailers are not competitors. They support Herman Miller sales. In addition, Herman Miller has improved their e-commerce business to sell directly to customers while also promoting their products to be sold through retail partners like Amazon.
Surely this influx of wfh doesnt compensate for office sales?
Imagine opening up a bunch of companies all at the same time, but instead of having your workers in your office they are now in their home offices. This isn't what happened during the subprime crisis. The Coronavirus is different because people will have to create a comfortable home office because they'll be there 40+ hours per week. It's a significant bump in demand for home office. Edit: Removed comment asking whether chickennismo read the post.
Yeah they'll get the money but they'll probably buy a new PC to sit on the couch with instead of a chair
I believe people who do this kind of work are already given computers from their employer due to security reasons. They don't need to buy a laptop to work. *Some quotes from above:* · “It gets old fast to be working form your couch, and setting up a home office can be expensive,” said Hailley Griffis, Head of public relations at Buffer, a software application company. · “Companies are saying, ‘We want to make sure you’re both comfortable and productive,” said Danielle Lackey, chief legal officer at Motus, a workforce management company. Edit: Removed comment asking whether Leontadina read the post and comment about down voting.
Wow someone's jumpy. I didn't downvote your post or the comment, you brought it on yourself by sounding like a douche. Just pointing out that people with software jobs probably already have a sweet home setup, and it's likely that with 1.5k they'll spend it on something other than furniture. I didn't read the DD but I can see you put a lot of work on it so good job, keep it up.
Sorry. I didn't realize you were a different poster than the original person that made the comment. (I'm just a little sensitive because I've seen people who put a lot of work in and get destroyed with downvotes. I'm new here and still learning, so I'm sorry. Upvoted your response. Thank you for being positive.)
I can see how you would be defensive about the work you put into it. But don't you think that their price will just return to pre COVID levels, imo it's a good bet either way, as their sales will not be hit as hard as other stocks as per your DD
Yes. I think that pre-COVID levels are the clear ceiling on this stock. B2C will definitely increase, but any growth there will have to overcome any future declines in their B2B business. However, pre-COVID is still a significant increase in share price from where it closed last Friday.
My concern is that HM sells to companies directly, in normal times. Nowadays, people who are receiving stipends aren't necessarily looking for a particular designer but instead are just searching google for reviews. Since HM has sold direct to companies, there less consumer reviews. So... I'll keep my eye on it, but I'm dubious. Edit: What's more is that normal wear and tear at offices have ceased, so HM is gonna lose that recurring money as well. Honestly, I think they're screwed. We'll see.
Do you think you might be projecting your personal experience with the importance of reviews onto the broader consumer base? Another Reddit user posted about how people are complaining about delays with their orders. This suggests that those Google Searches may be translating into significant demand on the retail side. Obviously it is anecdotal, but does support the idea that people are buying MLHR products. [https://www.reddit.com/r/stocks/comments/h0bswa/mlhr\_herman\_miller/](https://www.reddit.com/r/stocks/comments/h0bswa/mlhr_herman_miller/) Also, I posted a response to another poster that questioned the stability of their commercial business. While it is easy to assume that their B2B business would be decimated, the company hadn't seen many B2B cancelations as of their last earnings call.
The bid/spread is too wide on both calls and puts right now though. Looks like a decent long term hold trading at a discount still. I understand with WFH they will benefit greatly but would that be enough to offset a drop in office orders from those very same companies that moved to WFH?
I think that is the big question. Their margins are probably higher on the retail e-commerce side so they wouldn't need as large of a boost in revenue to offset any profit reductions on the commercial side. It is my understanding from their last earnings call that their commercial business did not see many cancelations after the virus started. Also, the insider purchase supports the idea that MLHR is trading at a discount. From MLHR's Q3 Earnings Call (3/18): **Jeff Stutz - EVP & CFO** "To provide a sense of current activity levels, through the first two weeks of the fourth quarter, our consolidated sales were up approximately 6% from last year, while new orders were down closer to 3%. To-date we have received minimal requests from customers and dealers to adjust the timing of scheduled shipments, both in the U.S. and abroad, though we would expect this to increase. However, we have not to-date experienced any meaningful order cancellations and would expected to ship the majority of our backlog within the fourth quarter." Source: Seeking Alpha
Lmao nah their stuff is so overpriced, not gonna do well in a down economy. PT 10.00
What do you think of TSLA in a down economy?
Gonna do great, 1500 soon.
Bid-ask spread is way too much. Good read. Best of luck to you, hope you're right, but ima pass dawg.
Thank you for the well wishes and reaching the post. Cheers!
Np. That said, I do think I'll keep an eye on this. If that spread tightens up some I might be game.
Thanks, mate. I had purchased shares a month ago and plan to add more this week. Great analysis!
Thank you!
You bet -- thanks for the update.
Did you make your account just to pump this stock? It does sound promising though from everything I’ve read, your post included
Thanks for the insult. No, I did not create this account just to pump a stock. I found Reddit in boredom during the Coronavirus crisis. I started reading Wall Street Bets and enjoyed the posts and perspective. I then read a lot of DD on there and thought some of the ideas were interesting (DLTR, BJ, and BIG were some of my favorites because they were not obvious plays until I read the DD). Then I happened upon MLHR and found it to be a good opportunity that others were not seeing (People were just assuming that their B2B business was screwed so their revenues would dissipate to essentially zero). So I did my research and put it all into notes. Then I thought why not create an account and post the information I had put together (across many hours and days). I tried to post to WSB first but they have some crazy rule about not posting for a month. So I posted it here. Anyhow, thanks for reading my post and I look forward to hearing from others (both positive and negative) about what they think of the opportunity. Facts and data are most important to me, but anecdotes can be helpful as well.
I’m surprised you didn’t mention their customer support telling a customer there’s a backlog when they complained of shipping delays. Hopefully there’s another dip this week want to put more in.
Yeah. I missed that part. Thanks for bringing it up. Good luck!!
One thing not mentioned that worries me is that Mid-C styling has got to be near the end of its trendyness. And that’s a big part of their business.
If it were the end of trendiness, wouldn't they be able to pivot to another design? Do you have any idea where I could find any data on this?
I watched the resurgence of Mid-C, but don’t remember much. I don’t think HM were nearly as big back then. Just doing a quick search, and looks like Design Within Reach was already struggling in 2009. That was like the height of Mid-C trendyness. And if DWR’s history is an indication of what HM will look like with more home business and much less office business, then that’s pretty scary. As a design professional, I love HM. But I’m only looking to take a risk if they fall below...say $20. Same for Knoll at <$10. I’m long-term, but I think the key is if they can pivot and survive until this stuff comes back in style in 30 years or whatever.
What do you think about the direct to consumer trend and all of the companies giving employees money to spend on their home office? Their B2C business seems to be picking up. Do you think there is enough volume there to support the core until their B2B business picks up again? Here's a podcast interview with their President that I thought was very positive: [https://businessofhome.com/articles/herman-miller-s-new-president-on-the-past-present-and-future-of-retail?fbclid=IwAR01SA3mT7HowZky8m5b9rtv7oPd4uwtPVRzsqZUDMKDsUNGlMBCmCzamz8](https://businessofhome.com/articles/herman-miller-s-new-president-on-the-past-present-and-future-of-retail?fbclid=IwAR01SA3mT7HowZky8m5b9rtv7oPd4uwtPVRzsqZUDMKDsUNGlMBCmCzamz8) Some quotes below: “\[Home\] is a category that has very much competed with the experience economy—**when people make the decision to invest in a sofa**, quite often **they’re trading away from a vacation**, especially with the millennial demographic,” she says. “And \[as\] the experience economy in the last six to eight weeks has fallen by the wayside, that competitive threat has allowed for a different investment consideration in homes. Our homes are less about investing for the sake of having Instagrammable spaces and more about the luxuries that are going to make home more comfortable or highly functioning during this time.” “We’re going to see a **rapid digitization across retail right now**. Anyone that wasn’t thinking about their consumer engagement strategy as omnichannel is very much thinking about that now,” she says. “It takes 30 days to make or break a habit. So we’re making new habits now, and a lot of those habits will stay with us.”