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!!

willfagg: Brilliant...spend more time studying your goldfish! I have given up tryting to work out MM's movements, but there is normally a reason behind these moves ... and sometimes we find out what they are and sometimes we do not! Could it be a tree shake, or some profits being taken, or indeed some derivative activities taking place. Let's wait and see. John

johngtudor:
Agree wholeheartedly. I use Metastock and Supercharts and from these all the signs were that the price was toppy. MACD 25,40,25 crossed down on 24th the 5,35,5 macd (american guru Chris manning uses this as it responds quicker) crossed down on the 10th Nov And the stoch crossed down on the 18th so the signs for a correction were there but the 21 day RSI is still above 50 which is still a good sign, roll on 1200 hours as buyers now outnumber sellers. thank you for your advice. Seadog

Good buying volume at moment with total buys up to 2.1 m with sells at 1.6m. Price may need to rise this afternoon to keep profit-takers interested. Well done, buyers at 69p!

No visible reason for selling other than profit-taking plus perhaps, with respect to jgt and sd, chart followers. The warehouse is no reason as they state that they have satisfactory arrangements in place over Christmas. What's a warehouse in contrast to 50 retail stores?

A reading of the financials. Key figure is overheads, where ASOS have their largest advantage over the high street retailers (together with stock investment). Last year, second half 'admin expenses' were up just 7% over first half. Lets suppose the figure is 14%. Annual gross profit, up 80% as indicated. of 6.9M. Administrative expenses of 4.6M. Operating profit after Goodwill of 2.1M. Ignoring potential tax rebate, earnings of 3.1p per share. pe of 25. I reckon that is low by 1/3rd which implies a price of 115p. So the share is definitely a BUY. Seymour Pearce are bound to repeat their OUTPERFORM. So carry on stacking them higher, folk!

Eric

John, SD

Interesting that this is the fourth time in six months that the sp has reached the MA50 chart and it rebounded the previous 3 times. I always tend to look for a trading reason why the price should fall with a balance of buyers or vice versa. This seems to be typical in that the price was taken down quickly on early selling, presumably profit taking and closing of positions; there is much less reason for it to rise as quickly when the pattern of buying and selling is established and the difference between the two is not that significant, i.e. the MMs aren't caught short or long. Nothing sinister, but embarrassing if you have geared your holding through cfd's! I'm still a buyer and still looking for 1 before Xmas.

Festive cheer to all! Eric

hope you are right.Having topped up again at 69P i am ever hopeful the 1 will be reached soon

Hi folks

Here are the key points from the analyst presentation today

Monthly Sales: Fluctuated between 600k - 800k April to September vs 300 - $500k range in 2003. More importantly JUMPED TO 1 MILLION MONTHLY SALES IN OCTOBER

FOCUS ON SIGNING UP BRANDS: Miss Sixty will be kicking off properly in Q1 05, ASOS have bought 400k alone of stock. Negotiated a deal to sell stuff cheaper than Miss Sixty do in their own shops!! This is core to the strategy - brands are warming to the internet and Robertson is targeting them before anybody else and where possible signing them, exclusively if possible, to ASOS

ASOS is ranked No. 2 in Hitwise, with a 4.6% share of the market second only to Next

Massive step change in customers in October / November - 750,000 unique visitors in October. Currently 55-60k people visit every day. This is a step change from 500-600k range in Jan - September and has continued into November

At the moment ASOS are taking 2500 - 3000 plus orders per day
Average shopper is ordering over 2 items per order

Average basket is moving up. September - November saw a range of 32 - 36

6 key departments: Womenswear 68% of sales (55% acheived margin), Menswear 13% (53%), Jewellery 7% (65%), Hair & Beauty 4% (46%), Gifts 4% (48%), Acessories 4% (60%)

Reiterated that summer months are slow for retailers and the interim period only accounted for 36% of sales.

Amazon.com and gift vouchers have been put back until the new year as IT/logistics issues became too much.

Nick Robertson stated that they are UK focussed for the foreseeable future. At this time the management have their hands more than full with the UK. International sales through the affiliate schemes are still growing although the UK and Amazon is still going to happen.


Cheers

Baheid

baheid

An absolutely brilliant post! Thanks a million! Ties up pretty well with my figures in post 830. I quoted gross profit there but it implied a turnover of 8.5m in second half. So they did need to do 1M in October. But the volume is building up very well indeed. One is also really confident that they are coping. A good example is Miss sixty. they are already geared up for the launch in January and that will help to keep the momentum up in the New Year. Extremely significant that they can sell at a lower price than the Miss Sixty shops - why should an orgainisation build up their own shops if they can sell more effectively through ASOS. amazon.com and gift voucehrs can then also play their part. Its right too to concentrate on their home market rather than dilute themselves.

The SP is certainly not over-cooked. As I mentioned above, the fall today is solely the effect of opening profit-taking and subsequent buying volume has not been able to offset that. I certainly wouldn't be surprised if the trading chart tomorrow is not the inverse.

Eric

I searched for the analysists report but got nowhere, well done that man!!!

Lucky old willfagg - right on the ball!

Perhaps worth clarifying my point about 'inverse trading' tomorrow compared with today. There will be a lot of favourable press comment tomorrow based on the analsts presentation. They will pick up on the internet story with the build-up of sales for the Christmas season. They will pick up on Miss Sixty because it demonstrates how ASOS can beat the retail shops because of low overheads. And it will not just be the 'serious' press but the Mail, Express etc. who target these young ladies and who have featured ASOS in the past.

So there will be buyers around in the morning and the MMs may mark up the price as a precaution. The price will jump back into the 80s. This will bring back all those who want to take profits; anyway, if you were in at 10p, why stick around for the last 50% or so? But the price will stay above 80p and will move a bit either away depending on the preponderence of buyers or sellers. So what to do if you're a buyer? Get in at 8:01 but don't chase the price up as it should come back as there must still be sellers around who would have liked to sell today but didn't like the price. By the time the buy recommendations come in from the weeklies and Sunday's, the sellers should have gone away to spend their proceeds at ASOS, the buyers will predominate and the price will move elegantly into the nineties. You could say that the statistics will be good; the shape of the curve attractive! A round pound before Xmas; no doubt about it!

There it is in a nutshell. Really sexy!

Eric

EW:
Good reasoning, good logic, Eric, but Sexy ?????????????

Sorry SEADOG, it was the sexy young things in their ASOS dresses which were in my mind's eye!

Eric

Agree completely EW but you had me worried !!!!

dear EW
i assume the "right on the ball" had a mere hint of sarcasm relating to my comments sbout the share price movements following results announcements. Still I accept that many people who post on here are much more experienced than myself and appreciate their views including your own.Without doubt these views do enable one to get a more balanced view and ultimately make improved decisions

after my wrong assumptions of yesterday my concern today is why at 70p arent people buying like crazy. two weeks ago investors would have killed to get this price(IMO)

Anyone got anything on this?

Correct me if I am wrong, as I may have mis calculted, but the RSI says 'Buy' the Bollinger Banding says 'Buy'... The report looked good, so 'Buy'.

From a chart view, the MA10 has not hit the MA50 which has seemed to spark the recovery in the past... I am wondering if anyone else is thinking the same as me... that we may have a few more days of decline before recovery (while the MA values sort themselves out), or that the shares will hit a support value of around 60p before recovery... but I dunno... I'm still new to this!

I have already been proved wrong by the price falling to 70p, and your assessment about needing to fall to 60p before it MA50 is hit may be correct . However this company is exceeding all its targets and has yet again just unveiled very impressive results. Now even allowing for some profit taking ( and it is Xmas) a 21% price drop over 14 days on a share that is performing out of its skin seems an unlikely candidate fora further 10 p reduction before buying kicks in.(IMO) I would have thought that 70 p was a bargain that i am surprised is still on offer, but price movements never cease to amaze me and frustrate the pants off me

willfagg

The "right on the ball" certainly did not have any sarcasm about it - rather envy! No spare funds! I suspect you were also right to get out of YOO straight away and switch the funds into ASC. Right?

I sometimes wonder where so-called 'experience' gets you! I suspect it gets you to a position of better judgement in hindsight! In my post yesterday, I argued for the 'inverse' trading shape today. What happens? Almost the exact replication of yesterday. Initial mark-up with a 50K trade before opening. A balance of early selling drops the price. Buyers thereafter predominate but price fails to make much headway. In fact, a further drop around 10:50 giving another buying opportunity below 70p.

Price now starting to make headway again. So where does it go from here? Need to be careful about the wishful thinking! But, here goes! Since yesterday morning, sales have been over 5% of the equity and buys closer to 6%. Selling most likely to be profit-taking (could be the bears but I suspect that to be too risky). My argument is that we will run out of sellers but the buying will go on because of positive publicity; small investors will want a stake; the share is getting large enough cap. to attract the institutions. It just needs one session, or part of one session, with buyers heavily exceeding sellers for the price to really move ahead. I suspect the chartists (??) will read it that way too. I bloody well hope so with my cfd's looking a bit sick!

Eric

FT article entitled "Celebrity fashions put ASOS into the black".

Article refers to the launch of own label in March. "This will take our women's wear range to the next level," Nick Robertson said. Also predicted "...healthy Christmas profits as more shoppers decided to avoid the crush on the high street and shop online". John Stevenson, analyst with Shore Capital, described the results as solid: "There looks like there is still good growth in the company".

FT Comment:

ASOS is cashing in on the growing hordes of consumers sho want to look like theri favourite celebrities. The increase in turnover and number of subsribers is encouraging, and there is still scope to raise the margins while the move into own-label should help. Further expansion is also expected to come from the proposed doubling of lines from 1300 over the next 12 months. With a full-year profit forecast of some 1.5m, the shares are on a pricey multiple of about 36 times. This falls slightly to 24 times next year. Those who missed the boat earlier may be kicking themselves, but there does look like some potential for growth."

EWR comment:

My calculations previously make the profit forecast look cautious and a 50% uplift for next year looks doubly so (the Internet fashion market overall will be increasing by that sort of figure). However, sensible to set numbers you can beat! There does not appear to be any cloud on the horizon!

Eric

Lovely blue this morning! 40 minutes and 400K buys including the 'unknowns' which are obviously buys. If 'Evil' has been short-selling, he reckons he's onto a loser; sorry, winner!

jgt

How's the FTSE100 program going? If you're still reading, a follow up on CFDs. Down a fair bit although this trend will set things straight. What policy to you follow? (a) do you limit the position in terms of the overall risk; e.g. do you say the worst that can happen with ASC is that they drop back to 60p and know how you will fund the losses? (b) is there any argument for closing a position if you are confident of a rising trend - the costs are higher than wih on-line trading but you have to factor in the cost of overnight money. All the best and many thanks in anticipation!

Eric

Eric: If it helps I did think of you when the ASOS SP fell after the recent announcements because of your gearing. I think myself some of the fall was from profit taking, and some punters fell that the stock is perhaps toppy with a fully rated P/E. Still what do I know as I am not a fundamentalist by nature! With regard to CFD's, I think you have to take into account the gearing you take on when deciding the SL. I never set a SL when I am in the cash market, but always do with CFD's. Now with respect to ASOS I have used the 50 day m.a. as a simple SL positiopn, plus a 'bit'. The 'bit' I use is because I want to avoid being stopped out of a position as the MM's take the SP down to that level. To make this even simpler, use the MonayAM charting package and play with the m.a. feature set. You can change the m.a. lines and find one that fairly accurately tracks the lows of ASOS over the last few months. I hope that helps. jgt