Are boohoo’s numbers as good as they seem?
Investors have responded badly to a strong trading update from boohoo. Are they right to have scarpered from the online fashion retailer?
A 9% share price fall seems like an odd reaction to a forecast-beating trading update. boohoo (BOO) has said that its revenue growth in the year to February 2019 will be between 43% and 45% - ahead of the previous guidance of 38% to 43% - thanks to a better than expected end to 2018. But investors are nervy and with good reason. The UK’s online retail sector was shaken in December when boohoo’s closest peer ASOS (ASC) announced a major profit warning. Excessive discounting reduced the group’s average selling price in the three months to November 2018 (before the major Christmas sales…