British Fashion Electronics Boohoo Is Expected To Raise Its Stock Price Is Still Down 10%

The good news that Boohoo Group PLC (BOO.L) raised annual revenue growth expectations still failed to meet investors' expectations of the holiday season's driving profits, and the British fashion business fell nearly 10% on Tuesday.

When the biggest competitor ASOS PLC (ASC.L) lowered its annual performance outlook in December, the Boohoo Group PLC, which emphasized its strong performance, disclosed that the three quarter income increased by 43.8% to 328 million 200 thousand pounds, an increase of 41% over the market expectation, and 43% after excluding the exchange rate effect.

The impressive growth continued to be driven by two businesses PrettyLittleThing and Nasty Gal, which were acquired in early 2017. They recorded 96% and 76% fixed exchange rate gains respectively as at the end of December.

PrettyLittleThing achieved quarterly revenue of 144 million 200 thousand by its outstanding performance, which was only 13% less than the Boohoo business which rose by 14% to 163 million 500 thousand a year, compared with 24% in the first half of fiscal year.

During the three quarter, the growth of Boohoo Group PLC in the UK and the European market slowed down significantly. The growth rate slowed down from 43% and 72% in the first half of the fiscal year to 33% and 54%, respectively.

The United States and other markets in the world have accelerated, with growth reaching 80% and 32% in the three quarter.

Emily Salter, a retail analyst at GlobalData, a data analyst, thinks that as the Boohoo brand develops relatively slowly in the UK, the group should increase its operations and infrastructure investments in major global markets, especially in the US market.

Sophie Lund-Yates, a securities analyst at Hargreaves Lansdown, agrees with her view, but at the same time warned of the high cost of "American adventure".

The gross profit margin of Boohoo Group PLC increased by 170 basis points to 54.2% in the three quarter, and 150 base points and 170 base points rose in Boohoo and PrettyLittleThing two businesses respectively.

Jefferies Group LLC Jie Fu Li analysts pointed out that compared to ASOS.com, the website of the Boohoo Group PLC website held fewer promotional activities similar to "full twenty percent off" instead of tactical marketing such as "black Friday" and other key holidays "low to sixty percent off".

Now Boohoo Group PLC has raised the annual revenue growth target from 38%-43% to 43%-45%, adjusted EBITDA profit margin outlook from 9%-10% to 9.25%-9.75%.

Analysts say the volatility of today's Boohoo Group PLC (BOO.L) reflects investors' disappointment that management has failed to raise profit expectations, which obscures the group's performance and continues to outperform its apparel retailers.

John Lyttle, an executive from Primark Stores Ltd., the UK's cheap clothing retailer, will be the CEO of Boohoo Group PLC in March and co founded the group 14 years ago, and the current Mahmud Kamani and CEO Association of CEO will focus on long-term strategy and brand development respectively.

Boohoo Group PLC (BOO.L) closed 177 pence on Tuesday, down 9.04% throughout the day, narrowing its growth to 9.6% in 2019.

ASOS PLC (ASC.L) released a profit of 37.6% in 2019, and it has rebounded 25.6% since 2019. On Tuesday, it gained 2860 pence and 1.21% in all day.