Asos: UBS slashes target price

(CercleFinance.com) - On Wednesday UBS slashed its target price for Asos shares to 660 pence (from 1,250 pence), citing a lack of near-term catalysts and the complexity of the group's proposed new business model.


The broker, which maintains a "neutral" rating on the British online fashion retailer, said it had revised its sales forecast for 2023 downwards in view of what it described as "lacklustre" demand and stocks that remain largely excessive.

This has led it to reduce its earnings estimates for next year, ahead of promotional offers to clear inventory and the "recalibration" of expenses as part of the transformation project.

Finally, UBS says it is taking a more cautious view of the company's medium-term trajectory, i.e. after the expected turnaround in 2023, pending tangible progress in both sales and profit margins.

Despite another broker bashing the stock, it is actually up 1.3% this lunchtime.


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