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!!

ASOS plc

('ASOS' or 'the Company)

Holding in Company

ASOS was advised on 15 November 2004 that Man Financial Limited was interested
in a total of 2,135,000 ordinary shares of the Company as at 11 November 2004,
representing 3.03 per cent. of the issued ordinary share capital of the Company.

Excellent news! Definitely looking forward to topping the pound on the run up to results and if Man are in they must be looking for higher prices than that next year.

moneyplus

I think it is Man Financial who go up on that particular news rather than ASOS. When I speak to a finance company, I check their credentials by asking them what they know about ASOS! There are unlikely to be any surprises in the actual trading results as we already know that they are 85% up in revenue terms after 5 months. What will be important is the level of bullishness in statements about Xmas trading. Giving the gloom pervading the High Street, I suspect that their report will blow a few minds into new attitudes about the internet asa trading vehicle! The surpise - I sold some today! The relief! - to buy ASOS cfd's on Thursday (perhaps plus a few Alizyme)!

Eric

I'm old fashioned and buy and hold. Never had the courage and know how to trade CFDs or spreadbet. I am put off by the dire warnings about losing money!! I've lost more than I care to admit buying and selling normally.

Moneyplus:
Welcome to the club !!!

Man have not necessarily taken a position themselves. This could be the number of shares that they are holding for their clients, which is probably more likely imo.

capa

up 5p today, how much further does anyone think that we may go on this one???????


the cash captain!

cash - if only I knew the answer.

My guess on eps for the year is circa 3.5p which means I think the present P/E is around 25 which for a company growing like Topsy is ridiculously low.

Once results are out later this month I will be surprised to see these below a quid.

capa

If we were in US the p/e of ASOS would be well in excess of 50 imo, ebay has a p/e of about 90 I believe.

What p/e does a money making e.tailer command in the UK ?

capa

There was a nice piece on ASOS in a column in Times Magazine on Sat. She was saying what a great site it is, and how she can look like "celebrities" who are 20 yrs younger than her!

Can only do ASOS' profile good.

The discussion of CFDs and the question as to how much further will ASOS go are clearly linked. If you believe that they are approaching their peak at around 1 then you don't do CFDs. You can't do probability analysis on it. But in a way you have to! Investing is a nice name for gambling, but perhaps the whole of life is a gamble! So, if I believe ASOS will soar away over 1, what do I do? OK, hold what I have. OK, buy some more. But why not, instead of buying, say, 3600 shares, buy a CFD for 12,000 for the same money. OK, you say, but what about the downside. We are back to the probabilities in my mind. It is a much better bet, in my view, and lower risk, to put 3000 on a CFD in ASOS than buying the shares of M&S or even Next. If I couldn't afford to lose the money, I would invest in Tesco and leave it there for 10 years!

So how far will ASOS go? Say for current year, 16m revenue, 1.6m pbt gives a pe of 37.5 at 90p. That's a bit challenging already isn't it? So let me say what could be said about current trading and perhaps in an analyst forecast:

1. Above revenue is based on first five months trading (AGM statement). But they strengthened their menswear theam in March, accessories team in April, jewellery tam in June and appointed both footwear and beauty buyers in time for the Xmas season. So we could be looking at something more like 20m.

2. Cost of sales ia about 50% of turnover. Based on growth in overheads last year, it would appear that overheads may not be more than 75% of gross profit.

3. This would mean revenue of 20M, profits of 2.5M and a pe down to 27.

4. Given that the price will normally reflect projections for 2005, lets say these are revenue 40M, profits 5m, pe 13.5.

Well, you say, that means the current price is justified Then we add in that the growth in online fashion purchases from one in 24 last year to one in four in 2009 so the growth is not impeded by market capacity for the next five years. So ASOS continues to grow exponentially. Then we factor in the fact that they must be a marvellous takeover target for one of the retail chains desparate to have a significant stake in the online market.

Finally, we factor in that everyone and his dog will want a share in the action, people will pile in as the top appears and the share will overshoot. I think you can justify 150p but it could overshoot to 200p. That is the range in which I aim to take profits!

Warning! A lot of this is conjecture! But it does represent my deeply held views on the share and on which I am prepared to base my decisions - until and unless I am proved wrong that is. In a way you are better to ignore this so long as you hold until the interims and can update this view with actual news from the company and their analysts.

Eric

Of course there is always the chartist view. Apparently we have just begun the first wave of a three wave bull run, the first wave is due to stall and take breath at 1.40, before the second wave takes over.

The third wave, wait for it, takes us up to 5 !!!

Hardly bares thinking about.

capa

2 x 232,500 buys at 90p suggest we may have a way to go yet.

capa

Really hoping that PET comes through before these results are due as would really love a much bigger chunk than I have at the moment.

sandrew

And so say all of us! And so say all of us! For they are jolly good fellows: ASOS management, their buyers and their clients; Horgan and the PET guys; the Iraqi Oil Minister and his cohorts (not to mention the YOO management and their takeover target)... Back to refrain! We need consecutive jumps to correspond with capa's consecutive waves in a bull run.

capa

I like that. Happy that the first wave 1.40 is in line with my 1.50. But hold the price back please as I can't buy my next CFD until Thursday! (will include some AZM, I think!)

Eric

sandrew

exactly my position!

capa

what is the timescale of these waves? is it linked to the results?

JJ

107606

I am no chartist but I know someone that is.

His view is that for the chart to behave perfectly the 5 will be reached by September next year. The waves are equidistant so 1.40 by Feb the next wave takes us to May/June and hey presto !!

Stepping back for a second you have to realise that this scenario depends upon results being great, and all other things being equal (interest rates/terrorism,stock market crash etc etc).

It also takes a great leap of faith to believe that ASOS can be valued at 300 million by next September, if you cannot see this being possible forget the 5imo.

What would need to happen ?

Profits before tax of say 6 million for the year end accompanied with a trading statement so upbeat it makes you swoon.

Broker estimates of say 15 million profits for yr end 2006 and then the market to re-evaluate favourably.

Far fetched ? Who knows, but I remember an out of town retailer not so long back called Matalan.

capa

Eric - Hurry up I can't hold AZM back any longer. Feel like the boy with
his finger in the dyke.

capa

Thats dyke as in the ones found in Holland in case any of you with filthy minds get the wrong idea :-)

capa

capa, johngtudor

Thanks for that, capa. Done CFDs for ASC and AZM this morning. The problem with the sp ramping with both stocks its a real problem being out of the market for effectively 3 days. There seems to be no alternative with blue index though otherwise their service is fine. I had freed some additional funds but decided to go directly into ASC at 92.5p rather than take the risk of waiting for Monday, although I could then have made the funds go three times as far. Probably best to take the CFD thing a step at a time. We are getting pretty close to the interims and I see the price going through 1 early next week in anticipation. What a great share!

Eric