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Ashley v Kamani will get very interesting very quickly
https://www.telegraph.co.uk/business/2023/10/06/frasers-group-mike-ashley-boohoo-largest-shareholdeholder/
Well they may have built it up but Mike is buying very quickly - so need to act fast.
He is more likely IMO to go all out for a takeover here than at ASOS. And it’s easier to do here than asos
Mahmud will now be thinking again about taking this private as was reported last year. But he needs to act very quickly now. Maybe this is why son Umar bought 3 per cent very recently. While family clubbing together to get it private?
Exactly right with THG, I got in there low and it doubled. I sold a bit too early but there we are.
The same will happen here (and I’ll probably still sell too early!)
Umar or Ashley buying more?
I’m hoping Umar buys loads now and him, daddy and family just take it private.
Mamud was thinking along these lines last year when the SP was a lit higher…
https://www.thisismoney.co.uk/money/share-investing/article-10555387/STOCKS-WATCH-Share-plunge-sparks-talk-Boohoo-private.html
And who could blame the family for taking back control of this.
Closed a lot less than 4 per cent down in the end.
Other retailers like m&S actually fell by more than Boo.
Jefferies cuts boohoo price target to 75 (85) pence - but reiterates a 'buy' rating.
Meanwhile…
(Sharecast News) - Shore Capital has reiterated a 'buy' rating on Boohoo despite the fast-fashion retailer cutting its sales guidance for the year.
The company said on Tuesday that group sales would decline by 12-17% in the year to 28 February 2024, much lower than previous guidance of sales decrease of up to 5%. This was due to a slower-than-expected volume recovery and the continued targeting of more profitable sales within its labels.
As a result, Boohoo's share price dropped 9% on Tuesday morning, falling to 28.73p by 0940 BST.
Nevertheless, Shore Capital highlighted that the targeted approach to more profitable lines should boost profitability.
Meanwhile, Boohoo's financial standing "appears resilient", the broker said. It has a strong balance sheet and significant liquidity position of £290 million with net debt in line with guidance, which allows the company to make ongoing investments in growth-focused projects, including the launch of the US distribution centre and automations in Sheffield.
"Significant investments in areas such as best-in-class logistics and in-house technology platforms have been facilitated by a robust cost savings programme, earmarking over £125 million of annualised cost savings across various domains for FY24F and FY25F," Shore Capital said.
Regarding Boohoo's valuation, the stock trades at an enterprise value-to-EBTIDA ratio of seven.
"In our view, the group remains steadfast in its medium-term objectives, leveraging cost savings and operational efficiencies to fund strategic initiatives. These are aimed at restoring growth and profitability."
Peel Hunt forecasts first-half EBITDA of £34 million, just under half its full-year forecast.
"The successful launch of boohoo’s US warehouse is one part of the potential recovery story – there are positive signs of performance on this point, with PLT & Nasty Gal both already live," said Stevenson.
"The interim results will hopefully give a greater sense of cost and margin recovery, with peak trading then opening the conversation on where margins can go over FY25 and beyond, and how the newer brands and the Debenhams platform will add to growth prospects."
Citigroup cuts Asos price target to 570 (600) pence - 'buy'
Daily Mail coverage today citing Joshua Warner analyst at City Index, positive on ASOS saying the company “has kept on the right track” and pointing out that profits per order are up 35 per cent with most unprofitable customers being swept away and the number of returns falling.
Debt falling too etc etc
I have to agree that there is a lot of upside here.
Aarin Chiekrie, an analyst at Hargreaves Lansdown, said: “Gross margins are heading back in the right direction as freight costs have pulled back from 2022’s peaks. The oversized inventory levels have also been brought back down to earth faster than expected..”
I expect this to rally in the coming days.
Falling debt. Less risk. Way undervalued.
Less debt means less risk.
And less risk can mean a higher share price.
All on track for the big turnaround but I now agree an offer will come very quickly here
https://www.cityam.com/asos-transformation-plan-on-track-as-firm-cuts-marketing-to-least-profitable-customers/
Massive hike in shorts on Friday. Wow.
Very risky in my opinion
Russ Mould, investment director at AJ Bell, told City A.M: “Analysts expect ASOS to have closed its financial year at the end of August with net debt of £238m and anything lower than that should be seen as good news, as less debt means less risk and less risk can mean a higher share price.”
Very predictable this share.
The article in the Financial Times is very interesting this weekend.
Hints at an ASOS / Boohoo merger, a ‘tie-up’ before describing it as a ‘defensive merger’
Before concluding re Ashley…. “Opportunistic dealing by one of its shrewdest participants is a good reason to think a second wind is not that far away.”
https://www.ft.com/content/6763ba0a-a9eb-4dfb-aaaf-0d112e350e09
An interesting week ahead!
100 per cent. Retail all down today, really negative press. But ASOS rocketing. Maybe the Turks are back !
They will have been putting accounts together from today, last day of their financial year. Safe to say it seems there’s been a leak. Ashley knows he’s getting a great company on the cheap if he has his way. Same as Boohoo
Opportunities to buy a huge company like ASOS don’t come around much so it’s not just Ashley wanting it… Mark my words there will be quite a battle to get this and it’s only good news for us…