Boohoo shares soar as online retailer boosts full-year guidance
Shares in online retailer Boohoo soared to an all-time high this morning after the fast fashion firm increased sales growth guidance for the year.
Boohoo’s share price was up 15.37 per cent to 280.7p after the company announced sales growth would be between 33 per cent and 38 per cent, against previous guidance of 25 per cent to 30 per cent.
Read more: Boohoo snaps up Karen Millen online business for £18m
The e-commerce business now has a greater market value than its AIM-listed rival Asos.
The board said earnings before interest, tax, depreciation and amortization (Ebitda) margins for the financial year will remain at around 10 per cent, in line with previous expectations, due to planned investment in its recent acquisitions.
Boohoo bought the online brands of Karen Millen and Coast out of administration for £18.2m last month.
Boohoo said the online businesses, which reported direct online sales of £28.4m in the financial year to February, would be “highly complementary additions” to its e-commerce platform.
AJ Bell investment director Russ Mould said: “It is very encouraging to see online fashion retailer Boohoo raise guidance for the pace of sales growth…Equally positive is the fact that margins aren’t being squeezed which suggests it isn’t slashing prices simply to shift stock and push up sales.
Read more: Boohoo confirms offer for Karen Millen
“The company is clearly on a roll and offering customers a wide range of products which are seemingly ‘on trend’ and at the right pricing point.”
Graham Spooner, investment research analyst at the Share Centre added: “Boohoo remains the only retailer that The Share Centre has been positive on and feels that the shares could remain a ‘pretty little thing’ over the medium-term.”
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