Make your money go further for just 25p per day

Are boohoo’s numbers as good as they seem?

15/01/2019 · ASOS (ASC)  · boohoo.com plc (BOO) 

AIM Shares UK

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 period had even begun) which contributed to margin erosion and lower than expected revenues.

boohoo’s numbers, though impressive, haven’t eliminated the risk that the group won’t befall the same fate as ASOS before the financial year (which ends in February) is over.

True, revenues in the financial year to date are well ahead of the…

Sign up and read the full article

Register to continue reading this article.

Get FREE access now

Already a member? Login

Have your say

Log in or register to view or add comments.

For access to the top news and insights from the investment world

REGISTER FREE TODAY

Become a Champion Investor for as little as £3.20 per report or get a year's worth of money-making analysis for just £90.

SUBSCRIBE NOW

More on ASOS

Fast-fashion is an ethical nightmare

28/03/2019 · Company research

The Investor’s Champion podcast: The Amazon cloud

22/03/2019 · Podcasts
In this week's round-up of the biggest stock market news, the Investor's Champion team talks about…

Remember when the ASOS warehouse burnt down?

19/03/2019 · News & Insights
In its 17-year history on AIM, Asos has had just as many fires as it has…

Are boohoo’s numbers as good as they seem?

15/01/2019 · News & Insights
Investors have responded badly to a strong trading update from boohoo. Are they right to have…

ASOS carnage: what are the experts saying?

17/12/2018 · News & Insights
A profit warning from one of the world’s most successful online retailers has wreaked havoc across…

More on boohoo.com plc

Should AIM investors fear IHT changes?

10/07/2019 · News & Insights

The second of two papers published by the Office of Tax Simplification have sent shivers of…


Fast-fashion is an ethical nightmare

28/03/2019 · Company research

Are boohoo’s numbers as good as they seem?

15/01/2019 · News & Insights
Investors have responded badly to a strong trading update from boohoo. Are they right to have…

Bonkers value of the week: Ramsdens and Quiz

29/11/2018 · News & Insights
Our bonkers valuation of the week strikes a more positive tone on this occasion, covering two…

Cyber Monday: what does it mean for your investments?

26/11/2018 · Companies Analysed
Today is the biggest online sales day of the year. Sales over the long weekend -…

More from the News & Insights

Fulham Shore: more questionable director transactions

16/07/2019 · Fulham Shore

Victoria highlights the art of creative financial reporting

15/07/2019 · Victoria

The week at a glance: 8 July – taxing times for tech

12/07/2019 · Alphabet · Amazon · Apple · Facebook · Marks & Spencer · Ocado · Thomas Cook