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magazineASOS shares gain 80% year-to-date on growing turnaround hopes
While shares in ASOS (ASC) are down almost 90% on a five-year view, the once-mighty online fast fashion retailer has rallied 80% so far this year amid a broader retail sector bounce-back driven by the lessening risk of an economic hard landing.
ASOS reported a ‘significant improvement in profitability’ with its Christmas trading statement on 12 January, which helped to reignite investor interest following a disastrous period for the website for fashion-loving 20-somethings, whose shares cratered as competition, slowing sales growth, warehouse issues and supply chain problems conspired to drive earnings downgrades.
Now, investors are hoping ASOS’ ‘Driving Change’ commercial and turnaround strategy under a new management team led by CEO José Antonio Ramos Calamonte, which includes a £300 million cost savings plan, combined with fading margin headwinds, can drive improved profitability and cash generation in the year ahead and beyond.
The Topshop and Miss Selfridge brands owner’s first-half results on 10 May will include an update about March and April trading as well as further details about the progress made against the Driving Change agenda.
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