boohoo Group PLC gets target price nudge by JP Morgan as it makes
Analysts believe the online fast-fashion retailer is going in the right direction
boohoo Group PLC () got its target price nudged up by JP Morgan as analysts believe it is on the right journey to rebuilding confidence in its social responsibility and governance.
The online fast-fashion retailer remains an ‘overweight’ for the US investment bank but its target price was raised to 480p from 460p.
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Last week, the AIM-listed firm posted a 40% increase in sales in the four months to December so it upgraded guidance and expects full-year revenue to rise up to 38%.
It also reiterated 10% underlying (EBITDA) margin of 10% despite up-weighted marketing investment, mostly due to leverage the current customer acquisition opportunity, and significant COVID-19 related freight inflation.
The update included progress on the ESG issues, publishing the first report from retired judge Sir Brian Leveson who is overseeing the ‘Agenda for Change’ programme.
“The leverage being demonstrated, and hence the reinvestment opportunity, should continue to support growth, and is particularly reassuring in the context of ongoing concerns regarding the sustainability of the margin as the group continues on its journey to improve ethical & social standards in its supply chain,” analysts commented.
Shares rose 1% to 341.4p on Monday morning after failing to impress investors with last week’s trading update.
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