Should I Buy DX Shares?

Should you buy DX shares? The answer is, of course, that this is ultimately up to you. However, you may be interested to learn about recent developments in the Buckinghamshire based parcel delivery service. 2017 has certainly been an interesting year for DX, starting with benefitting not only from the usual Christmas boom in online sales and the subsequent transportation to customers but also from its unique, value-added service policy which set it apart from the majority of its rivals in the cut throat parcel delivery firm market, who were racing to achieve the lowest possible costs. This was followed, later on, the year by a City of London Police investigation into certain aspects of DX’s operations and this occurred when many were interested the proposed sale of the distribution arm of John Menzies, the logistics company, to DX. By July of 2017 the affairs of DX seemed to have descended into a sort of stalemate; while the business plan that DX had hoped to follow had impressed many as an imaginative and possibly viable alternative to the general tendency of the sector towards the lowest possible cost service, DX was suffering from a general decline in the market for the delivery of physical documents, this being perhaps a logical corollary of the rise in popularity of electronic mail. DX’s prices have remained high, which was inevitable considering its stated business plan, but revenues have been falling and by June 2017 people were noting that DX had lost ninety percent of its value since its initial flotation in 2014. Such a background may make you want to think twice before you invest in DX shares.

Should this have made you think second thoughts about DX shares, then June had not finished with DX; the GMB Union launched an action against DX, claiming that its self-employed drivers should be classified as workers. This came after revelations that drivers were faced with covering a charge for part of their routes if, for whatever reason, they were unable to work or find a replacement. It all seemed a far cry from the start of 2017 when many observers were predicting a bright future for DX. At that time there would have been no lack of people willing to answer the question posed in the title of this article in the affirmative. At that time DX shares did indeed look like a promising option, with minimal debt and an innovative pricing strategy that seemed sure to keep profit margins up. If this did occur, then there were predictions of a 31% increase in share prices with a 7% yield. All of these bright forecasts for the future were, however, predicated on DX keeping its revenue and also its pricing power. By the middle of the year, it seemed that DX was losing the fight, facing falling revenue and also a police investigation and potentially damaging legal action from unions. It seemed that in at least the first half of 2017, fate was against DX.

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