ASOS have dropped quite significantly in the past week for no particular reason and I view this as the perfect opportunity to invest as I can see them bouncing right back up to the 5.50p mark in the next 2-3 weeks. STRONG BUY!!

Stockdof sitting on a couple of dogs, so he says - bet they are bitches! legend a pessimist? pull the other one - what's that share he put forward for the ASOS challenge? ASC is one share you can tuck safely away (now!) but 1 by next Christmas is pessimistic; July, I say!

Eric

Well, after a day of fairly consistent selling we remain where we were at 59p mid at close.

Seems like MM's are happy to take on stock at this price, ready for the next ride up no doubt.

The cahrt could break either way, but with a PE to 31st March 2005 of 34 followed by 19 and then 14 and a PEG of respectively 0.45 and 0.28, I cannot see much downside to this stock.

proud to be the son of a b***h

SD

And another thing -

The warehouse induced discounting may have reduced profits by 350-500k, but the increase in sales and registered users is surely helpful in introducing another tranche of customers to the experience of a consummated visit to the site. If satisfied, they should return after the sale is over. How many visits makes a habit?

I always go back to old haunts!

sniff, sniff

SD

Well well well.....Fidelity - the world's largest fund manager is also now on board....

ASOS was advised yesterday that Fidelity International Limited now holds
2,131,300 ordinary shares in the Company, which represents 3.05 per cent. of the
entire issued share capital of the Company.

MM: Had a very pleasant and interesting chat with the CEO at the Master Investor show last Saturday. He told ne that there were several City Institutions with holdings in ASOS at just under the declarable holding...and then Fidelity went through the disclosure window. Looks like they are happy with the SP at this level to Buy and with the management! jgt

Helpful comments from John and stockdog (Woodie forgot what he was going to say!). I hope sd doesn't cock his leg against the curtains when he visits his old haunts! Need to recognise that there is a definite two-way pull now with ASC. The shorters are there still and there is evidence in the trading pattern today. John's input demonstrates that investing momentum is building up with the institutions. Short term speculators are looking elsewhere which is fair enough. Looking at my own portfolio, ASC is the holding that I view as most positive in the long-term and I am building up the holding on that basis.

Eric

Eric

What makest thou of the Shares sell recommend today - can't read it, since only at dog level. Interesting to see how much it affects the SP - certainly not positively, in spite of Man and Fidelity both declaring stakes Tuesday.

Fundamentals still look OK. Will the latest profit downgrade for March 2005 carry on pro rata to 2006, 2007? I don't think so, once the warehouse and logistics problem is sorted early next trading year. So, am still relying on consensus PE of 19.90 for 2006 and 13.54 for 2007 - hardly demanding for a growth story.

I continue to hold.

SD

stockdog

Will be picking up my copy of Shares when I walk the dog! I suspect they are subscribing to t1ps - evil's propoganda! Hitwise traffic figures remain at the levels established in Jan and Feb, so even it those were encouraged by an extended sale, sales should be back on track. The charts obviously look pretty dreadful. The sales today are mainly small investors, presumably influenced by Shares, plus three or four round figures which are quite likely part of the shorting exercise. Beginning to cause one or two problems with my CFD position but it won't be ASC that I close if I have to. Will comment further when I see Shares. Sentiment is bound to be negative whillst the last news is depressing; what we need is some positive projections which may not be until April.

Not a tail-wagging time! Eric

Surely the time to recommend selling a share is BEFORE it falls through the floor, not afterwards, when it's likely to stage a recovery.

This seems similar to the situation with MFI last year their sp slumped due to distribution difficulties hitting sales, but I bought when the shares were down and made a handy profit once they began sorting out the problems and confidence returned.

RD: Your approach is known as 'Contrarian Investing' based on good instinct...long may it continue to bring home your gravy! As for the Shares Sell recommendation today, I think you are right in your damming judgement, they should have called it before now....let's all hope they don't go the way of the Investors Chronicle!

John

Good points, both of them RD.

The market seems to think so too, holding at 57p, only 0.5p down since the Shares sell note.

Not so with poor old DEMG to which I am clinging like the wreck of the Titanic - still the orchestra sounds very nice to night, dear, don't you think?

SD

SD: Had a quick look at DEMG, for those LONG it is really a question now of how much pain you can take. The Charts suggest it could easily fall by another 50% or so! You must love the torture or have an arbitrage position running? John

jgt - I wish I did have some sophisticated safety net - alas no.

I shall sit it out a little longer to see what transpires. Seems to be holding steady currently at 17p bid a smidge off its floor so far today.

SD

I am no chartist nor do I claim to be an expert, but given the current climate the shares did look expensive at 80p.

I have no doubt that the company is excellent, me and friends buy from it and it is popular among young people. However, I think there are other better things to be in at the moment.

If you are holding for the long term, then good luck all, hopefully you will be ok.

Legend

In spite of nothing bud red and some sizeable trades at that, price seems to be holding firm at 55p mid.

Guess MMs quite happy to take on board a fair amount of stock (1.28m shares traded so far today). Do they know something - or is it just fair value on fundamentals we are seeing reflected here? I think the latter - there can't be much more to know about such a widely exposed company. Perhaps the directors have been unduly pessimistic about the effect of the warehousing problems on the out turn for the year which will be better than recently supposed??

Pathetically grateful Shares has not crucified more than one of my holdings today!

SD

I visited the stand at Master Investor and he had a lot of booklets that no-one would show much interest in. I believe it will return to good but not yet. The TA (if you are a tech believer)after the recent falls shows a clear fall for a while, maybe even down to the 30p mark. Although it is stated that warehouse is the problem we should see a turn around before putting faith back in the sp. Furthermore wait for all the retail ASOS's to buy / read their copy of shares magazine tonight when they get home from work.

imho sell up and buy back in June.

I really think that was about the worst recommendation I have seen from Shares. If it had been a report by John Marshall then it would have been well-researched - it may just possibly have ended with a SELL recommendation. However, John is a holder of ASOS and has written informative pieces in the past. If he had been involved he would have given a balanced opinion and would have talked with the company (they may though be in a close period). Quotes from the article: (1) "ASOS said last week that it was having more problems in its warehouse and current-year profits would be around 1.1m to March 2005"; (2) "This was below some expectations indicating slowing growth"; (3) "Though prospects remain bright the best is over for shareholders".

Someone who knew the company well and had studied the RNS would not have made these comments. First, the warehouse problems related to the Christmas season, when, because of volume, they needed to operate from four warehouses and systems were not geared up to that, resulting in delays to getting new merchandise onto the website and sales at lower prices in January and February. The new warehouse is coming on stream mid-May. All other indicators are positive. ASC is not "having more problems" - it has had problems.

There is no indication of "slowing growth". This is a problem of accelerating growth ahead of budget. Sales in Jan and Feb were up 120% and 140% respectively. "As a consequence we are bearing the costs associated with higher volumes but without the costs assocaited with them".

It is a mroe reasonable conclusion from the RNS that sales growth will be strong in 2005/6 and a considered conclusion may well be that another summer of growth awaits shareholders. The best is not "over".

I intend to write to Shares in a less critical mode but suggesting that we have definitive comment from John Marshall in the next issue. I will post the letter here.

Eric

Don't think this has been posted yet, from pat lays small caps section on TIM 03.03.05. Nothing new, but worth a read.

As seen going cheap

NICK Robertson, chief executive of on-line retailer Asos, probably has always known that the market success the company achieved last year - the shares rising from 5p to more than 80p - would be difficult to maintain, but I doubt if he ever considered he would be too successful for his own good.

A trading statement today said profits for the year to 31 March are now likely to be between 1.05m to 1.2m. Although that compares with 625,000 in the previous 12 months, he says 'this is a disappointment'. And the market agreed with him, hitting the share price by more than 7% as the news sank in.

Like many a conventional retailer before him, Mr Robertson found a problem of having too much stock that had to be off-loaded at knock-down prices. It is an indication of the size of the problem that January sales were up 120% and February 140%, but the company says: 'As a consequence, we are bearing the costs associated with very high sales volumes but without the gross margin to support them.'

The company has been operating out of four warehouses and that meant stock that should have appeared on the website before Christmas was being offered in January and February. It is some comfort that the group has now signed terms on one new 70,000sq ft warehouse which it hopes will be operational by May.

Rhys Williams at Seymour Pierce is one who has not lost faith, however, even though he is revising his original profit forecast downward from 1.55m to 1.1m. He says any weakness in the share price should be regarded as a buying opportunity. So, as Hughie Green - who more-mature readers might remember - would have said: 'Opportunity Knocks'.

oops missed a bit!

John Morgan and Quentin Griffiths, who left the board of Asos last year, have set up e-retailer, a new company to invest in, and encourage other online retailers (of whom there are many I am assured) to develop their operations and make their own way to market. They plan to raise 1m and come to Aim early next month.

Maybe some future Competition?