Boohoo stages modest recovery in opening weeks of New Year

Little evidence of external pressure on display as fashion retailer shares rise.

Article updated: 15 January 2019 11:00am Author: Helal Miah

  • Group revenues head up by 44%, driven by international expansion
  • Management ups guidance for full year revenue growth to 45%
  • We continue to recommend the shares as medium risk ‘buy’

Despite the profits warning by ASOS in late 2018 which also dragged Boohoo lower, the shares of Boohoo have staged a modest recovery in the opening weeks of 2019. The numbers produced by Boohoo for the final four months of 2018 do not seem to suggest the same growth slowdown as their larger counterpart.

Group revenues for the final four months of 2018 headed higher by 44% mostly driven by their expansion in international markets, but even UK sales were up an encouraging 33%. Just as importantly, the gross margins across all three brands were higher, taking group margins up by 170bps to 54.2%.

The online fashion retailer we have on our buy list has shown little evidence of the pressures on the consumer seen with other retailers. Management have upped their guidance for full year revenue growth of 43% to 45% from their previous guidance of 38% to 43%. As one of the smaller online fast fashion retailers, we have less worries over Boohoo compared to other retailers should the worst scenario unfold from the Brexit process. We continue to recommend the shares as a medium risk ‘hold’ for investors.


All information given including prices, yields and our opinion is correct at the time of publication. Our opinions on investments can change at any time and for our latest view please go to www.share.com. To understand how our Investment research team arrive at their views please read our Investment Research Policy.

Helal Miah portrait photo
Helal Miah

Investment Research Analyst

After graduating with an economics degree from University College London, Helal started his career within private banking at Smith & Williamson Investment Management and later held analyst and fund manager roles with the Industrial Bank of Japan, Schroders and Mitsubishi Corporation. He is a chartered fellow of the Chartered Institute for Securities & Investment.