Sales expected to rise even further as revenue growth beats predictions.
Boohoo (BOO) cuts through dark clouds of troubled retail sector
- Trading is ahead of expectations and group expects full-year revenue to rise between 33% and 38%.
- Shares rise 15% in early trading, taking them to an all-time high.
- Shares remain the only retailer we’ve been positive on and outlook remains unchanged over the medium term.
Following the latest news of M&S crashing out of the FTSE100, this morning’s update from the fast fashion retailer could reignite a measure of investor confidence in the retail sector. The group reported sales were now expected to rise by between 33 – 38%, up from the previous guidance of 25 – 30%. It continues to go from strength to strength and now commands a greater market value than its AIM listed rival ASOS.
The short trading update highlights revenue growth performance to have been ahead of expectations; however this will not come through to improved earnings margins with guidance remaining the same at around 10% as a result of investing in acquired brands.
Our view on Boohoo - Buy
The market has reacted positively to the update from the AIM listed group, with shares rising 15% in early morning trading, which moves them to a new all-time high and are up 65% year to date. Boohoo remains the only retailer we’ve been positive on and we feel that the shares could remain a ‘pretty little thing’ over the medium-term.
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