introduction
Over the pandemic we saw the collapse of fashion on the highstreet with the liquidation of Sir Phillip Green's empire. And what really hammered home the tidal shift to online shopping was when Boohoo and ASOS bought the Debenhams and Topman + Topshop + little miss Selfridge, respectively.
ASOS has a large growth runway as it plans to expand to the US. The PEG ratio suggests it's slightly overpriced compared to growth however it's important to remember - during a cost of living crisis, one of the first things people cut down on is clothes so growth at all right now is fantastic. Based on the book value of 1.0 the market cap matches the assets exactly which is what makes this such good value. Not to mention, ASOS hasn't traded at prices this low since 2010 despite drowning massively in that time.
Some financials
| metric | amount |
|---|---|
| Gross profit margin | 44.42% |
| Return on investment | 2.05% |
| PE | 32.22 |
| PEG | 2.8 |
| Revenue | £3.91B |
| Revenue growth | 20% |
| Market Cap | £1.04B |
| Share price | £10 |
| PB | 1 |
| Beta | 2.7 |
Caveats
Expansion into the states is notoriously difficult, and some of its future success depends on accessing that market. Competition is also a risk as their moat isn't particularly strong.
