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Can’t see brands of note going anywhere near Shein. They will either lose gross margin or lower their brand image. Not going to happen!
Analyst coverage is what they said. Not a call, but they clearly want the analysts covering what they say!
Cheap low margin clothing sales have their place, won’t change the habits of the customers that ASOS mostly target where brand and reputation matters. My son is 13 and Nike have his mind already, and when you were the wrong stuff at Gen Z it isn’t cool. Yes there will be those that are fine with Shein, but there will be as many or more that are not!
They moved the date in order to ensure all of the key analysts were available on the day. This to me suggests very clearly it will be a positive update and either detailed or brief but solidly positive. Clearly only insiders know if I’m correct, but I’m confident.
I don’t dismiss Shein, in many ways it has forced ASOS even more to concentrate on costs and profit per order along with getting stock and sizing correct to increase profits. Shein will take market share on revenue but will be hit on various fronts from regulation to tax and working practises and ASOS just needs to focus on what they do, do it well and make a profit on a high % of orders to ensure cash generation on the £2b+ sales. ASOS can become a cash machine with the infrastructure and capital spend they have made over last 5 years and I maintain the market cap is not reflective of their market opportunity. It is quite possible the entire market cap can be matched by free cash flow in less than 2-3 years and ignores the intrinsic value of their 24 million customers and capital deployed and paid for.
Well my hashtag for fun wasn’t very successful 😁. Was always going to be hard to change anything here before trading statement and with shorts seemingly depressing people with common sense (yes I truly believe they are that wrong at these levels). All of the reasons to be short are the reason the price fell from £8. But all of the expected news like lower rev hit higher profit per customer, lower debt and higher cash flow and the rest of the turnaround plan of cost cutting and efficiencies suggests it is all way over done. The cherry for me is certainly Mike Ashley, anyone betting against his knowledge behind the scenes is very brave and I am going to toast ASOS next week in a beer garden.
I think a wild card might also be some action against Shein in the US before listing, but that is long shot obviously.
Prices of car parks and increasing petrol will drive a further set of on line shoppers and I personally expect a very big uplift in sales for retail into Black Friday and Christmas, from personal view. Real wage growth for gen Z is only going to be a positive. All just musing comments…
I believe the market will start to rebound today and tomorrow, seeing lower peak rates and staying higher for longer as neutral and at least more certain. Quite a lot of commentators were saying this scenario will cause good momentum to the markets with cash moving back in. That is my trading view anyway. Tesla CFD is my play for fun today
The thing about the price is it’s got all the negative perceptions in at 3x the rate they should be. We all know the past issues and we all know the economy. The shorts have done well, clearly but those adding at the moment are not making sense. If you look at the balance sheet, the expected second half cash generation and the capital expenditure on distribution, AI and automation and the 24 million customers and the fact on much lower annual revenue the city valued it over £40 a share (yes read above there have been issues) but the price now with inflation falling and the 4 point turnaround plan, well… consumers are starting to see wage rises above inflation and are prioritising travel and going out over cars and other stuff.
You place your bets, you take your chances, but I like this sitting on my hands for up to 2 years and seeing return to £20. I believe regulation is coming for Shein and Temu is just shocking in every way, quality, website etc that you can’t compare. Gen Z like to buy brands. ASOS revenue over £2b can fall, losing unprofitable cheap customers and make good margins from the sales they do make and this makes a good business, with consolidation in the industry nearly inevitable and PE likely to look at it for the assets and cash generation sooner rather than later imho.
Anyway, very happy with comments from Next, patience needed 🙂
Read about William Barker a little. Seems nothing but good news that he wants his name more closely associated with ASOS. Lots of good indications from Next, cost inflation down more than expected. Like the mention by ASOS about sustainable profits, and next show profit very possible and add to that the push by Asos for better control of margins and stock and the recipe for next week looking very positive.
Can’t see anything bad from BOE. Either a shock pause (expect a rise) and market will ignore any hawkish tone as CPI was so low. I am very hopeful I was correct with the closing price remaining above £4 and shooting up next week. Key will be how Next trends today as it will drag others the same way as anaylsts quiz them about Q4
Think I should hashtag byebyethrees 🤣
Agree, brave 😁. Such short term predictions are a hiding to nothing and just a bit of fun/banter, but I believe strongly the results and turnaround will send this to £6 very quickly
I believe this is the last time £3x will be seen. I tend to agree about leaks, often small ones happen with all the people involved preparing for a numbers release a lot of people can’t help themselves to say things to friends, usually colleagues at work who share snippets and then the right person at a company who is short hears how much they are about to get done when the numbers go public. One short closing will.bring the herd with them…
Rates going up tomorrow unless massive surprise. It’s what they say that markets looking out for… CPI very helpful for retail today.
Yep. Wording is cut and paste
Fair Phoenix and didn’t mean to appear personal with comment so apols if came across..
Perhaps, perhaps not. Companies have a lot to deal with, not a perfect world and exec team have only certain dates that work. Who knows all the details, perhaps they set the date at the exact same time as the one which took the analysts they wanted. Either way if you are going to blame and pick holes for something that might or might not have been avaoidable, especially after the way they then changed dates to avoid the issue then I am stating you are looking for too much perfection or not accepting that life gets in the way of somethings regardless how you try to plan it!!
Anyway, for me the only discussion about the date now is what I said, is it a good or bad thing they wanted all the key analysts there, does this suggest they have bad news to share? Not in my opinion or the date clash would have helped slightly. Ok, smarties will say, but they want everyone there to explain the bad news… well you takes your bet, you place your money on what you believe and for me it is a positive if anything
Hodgeson, from ASOS directly.
What a stupid comment. They moved it after the analysts they wanted to attend couldn’t. All retailers report at similar times, it’s not a perfect world and they made a sensible positive decision to change the date so as to share all of their news with as many / the preferred analysts as they could.
So they were not able to get enough analysts for the day due to next etc. does this sound like the actions of a team hoping to release good news or bad news??? I know where my money sits and it’s going nowhere at all!!!!
From the horses mouth!!!
The decision to rearrange the trading statement was taken in order to avoid clashes with other companies reporting this week where there is overlap in analyst coverage. The date was moved very shortly after our intention to issue a P4 trading statement was announced and as soon as these clashes came to our attention.
I have also gained much amusement in knowing the reason for the trading statement date being changed. I am sure any investors with as much at stake as myself know this also. For any others, all I will say is there is certainly nothing sinister and I would consider the reason more positive than neutral if pushed. The amazing thing is how many discussions there has been, yet how simple it was to find the answer.