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Winning fast fashion womenswear brand is one for growth portfolios

Fast fashion womenswear brand Quiz (QUIZ:AIM) proved a Christmas retail winner and is a growth stock that should excite small cap investors. Pocket the value-for-money occasion wear-to-dressy casual wear specialist at 150p, where there is 46% upside towards Panmure Gordon’s 219p price target.

Encouragingly, this fast fashion retailer’s positive trading momentum continued over the festive period. Overall revenue powered 31.9% higher over the seven weeks to 6 January. While rival, tired-looking brands are waning, awareness of the Quiz brand is growing.

Sales growth is being generated across this omni-channel business; online and international showed especially strong growth over the trading period, up 119% and 51.1% respectively. Like-for-like sales are positive across Quiz’s expanding store estate and concessions are performing robustly.

Gross margin was also in line with expectations following ‘strong full price sales in the lead-up to Christmas’, assured Quiz, reassuring given a blizzard of discounts across the clothing sector.

Panmure Gordon writes: ‘With a scalable supply chain and capacity to more than double revenues, we believe the business is well placed to deliver attractive levels of top line and earnings growth over a sustained period.’

The broker forecasts a surge in pre-tax profit to £10.3m (2017: £8.2m) for the year to March 2018 and a maiden 1p dividend, ahead of £12.6m profit and a 2p payout next year.


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