Spreadex | Jan 09, 2019 10:49
2018 was a messy one for the online fashion firm. Opening at £1.88, it had tumbled to £1.40 by April, its worst price in 14 months. From there it went on a rocky rally, a duff summer overcome as it hit a one year peak of £2.48 in early October.
Like many stocks, and most UK retailers, it then had an awful end to the year, plunging all the way back to £1.61 by December’s close. Yet since 2019 began it has started to rebound, with Boohoo.com plc (LON:BOOH) now at a current trading price of £1.83.
The firm’s last substantial statement came in late September, and was the catalyst for the stock hitting that aforementioned 12 month high. Revenue rose 50% to £395.3 million, while pre-tax profit shot up 22% to £24.7 million. Crucially it also hiked its full year guidance, with revenue set to rise by 38% to 43% against the previously forecast 35% to 40%.
That wasn’t boohoo’s most recent update, however. No, on December 17th it was somewhat forced to issue a statement claiming that it had seen a ‘strong’ trading performance, with ‘record Black Friday sales’ and is trading ‘comfortably in line with market expectations’. This was in response to a profit warning from key rival ASOS (LON:ASOS), and couldn’t prevent boohoo falling 14% in a single session.
As for Tuesday’s post-Xmas update, investors will at the bare minimum want the avoidance of an ASOS-esque shock. Signs it is on track to match that new full year guidance will be key, though ideally the company will revise its forecasts. Whether or not it can manage that is going to be down to how cautious consumers were over the holiday period, something that has varied slightly from company to company so far this reporting season.
Boohoo.com PLC has a consensus rating of ‘Buy’ alongside an average target price of £2.43.
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