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ASOS plc (GB:ASC)
LSE:ASC
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ASOS plc (ASC) AI Stock Analysis

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GB:ASC

ASOS plc

(LSE:ASC)

Rating:46Neutral
Price Target:
301.00p
▲(6.17% Upside)
ASOS plc's overall stock score is primarily impacted by its financial performance, which is currently weak due to declining revenues and high leverage. While there are positive signs from recent strategic initiatives and improved cash flow, the technical analysis and valuation remain concerning. The earnings call provides some optimism with operational improvements, but challenges in sales and market performance persist.
Positive Factors
Financial Performance
The company's H1 EBITDA will be ahead of consensus, reflecting a strong gross margin improvement and cost discipline.
Strategic Initiatives
ASOS has made progress on strategic initiatives and reported a return to growth in ASOS Design.
Negative Factors
Profitability Challenges
Despite improvement, the EBITDA margin remains insufficient to reach overall profitability.
Revenue Decline
ASOS' revenue is down by 13% as previously indicated.

ASOS plc (ASC) vs. iShares MSCI United Kingdom ETF (EWC)

ASOS plc Business Overview & Revenue Model

Company DescriptionASOS Plc operates as an online fashion retailer worldwide. It offers womenswear and menswear products. The company sells its products under the ASOS Design, ASOS Edition, ASOS 4505, Collusion, Reclaimed Vintage, Topshop, Topman, Miss Selfridge and HIIT brands, as well as through third-party brands. It is also involved in the employer of marketing staff and payment processing businesses. The company was founded in 2000 and is headquartered in London, the United Kingdom.
How the Company Makes MoneyASOS generates revenue primarily through online sales of fashion and beauty products. The company operates a direct-to-consumer model, allowing it to sell its own brand products as well as products from third-party brands. Key revenue streams include the sale of clothing, footwear, accessories, and beauty items, with a strong focus on fast fashion and trend-driven products. Additionally, ASOS benefits from international shipping, attracting global customers. The company also engages in strategic partnerships with various brands and influencers to enhance its product offerings and marketing reach, contributing to its overall earnings. Seasonal promotions, discounts, and loyalty programs further drive sales and customer retention.

ASOS plc Earnings Call Summary

Earnings Call Date:Apr 24, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 15, 2025
Earnings Call Sentiment Neutral
ASOS demonstrated strong operational improvements and strategic initiatives resulting in significant EBITDA growth and enhanced margins. However, the company faces challenges with declining sales and underperformance in the US market and third-party brands. The overall sentiment is cautiously optimistic with a focus on sustainable profitability.
Q2-2025 Updates
Positive Updates
Significant EBITDA Improvement
ASOS increased its EBITDA by approximately £60 million, indicating a 30% increase in variable contribution over the last six months.
Gross Margin Growth
The company achieved a nearly 500 basis point increase in gross margin, which was driven by improved full price sales and lower discounting.
Expansion of Test & React Program
The Test & React initiative now accounts for 15% of sales in own brands, with significant growth in categories like knitwear, where 50% of sales are via Test & React.
Improved Operational Efficiency
Supply chain costs were reduced by 20%, and the returns rate was reduced by 150 basis points, contributing to enhanced operational efficiency.
Loyalty Program Launch
ASOS is launching a new loyalty program, ASOS.WORLD, focusing on excitement and fashion rather than discounts, expected to roll out in the second half of the year.
Negative Updates
Revenue Decline
Overall sales declined by 13% year-on-year, attributed to reductions in old and aged inventory and a decrease in unprofitable performance marketing.
Weak Performance in the US Market
US sales dropped by 28%, although profitability improved with the highest growth in variable contribution among regions.
Challenges with Third-Party Brands
The performance of third-party brands was relatively weak, which is attributed to a lack of discounting and consumers finding these brands elsewhere.
Company Guidance
During the recent call, ASOS provided guidance highlighting several key metrics that underscore their strategic progress and financial performance. Over the past six months, the company achieved an approximate £60 million increase in EBITDA, driven by a new commercial model that boosted gross margin by nearly 500 basis points. This model emphasized delivering the right product at the right time, enhancing product speed, quality, and flexibility, and improving supply chain efficiency, reducing costs by 140 basis points. ASOS's own brands saw a 12-point increase in full-price business compared to last year, contributing to higher margins. Despite a 13% year-on-year decline in constant currency sales, due to reduced old inventory and performance marketing, the company's adjusted EBITDA reached £42 million, reflecting a £60 million year-on-year improvement. The company also reported a 35% acceleration in stock turn, enhancing capital allocation. Looking ahead, ASOS expects adjusted EBITDA growth of at least 60% to between £130 million and £150 million for FY 2025, with gross margins surpassing 46%. They anticipate revenue growth at the lower end of consensus and aim to be broadly free cash flow neutral.

ASOS plc Financial Statement Overview

Summary
ASOS plc is facing financial challenges with declining revenues and consistent net losses. The balance sheet shows high leverage, which may limit financial flexibility. However, there is some improvement in cash flow, providing a slight positive outlook.
Income Statement
35
Negative
ASOS plc has faced declining revenues and profitability over the past few years. The revenue decreased from 2023 to 2024, marking a significant drop from previous years. The company has also experienced negative EBIT and EBITDA margins, reflecting operational inefficiencies and increased costs. Despite a strong revenue base, the ongoing net losses are concerning and indicate a need for strategic adjustments.
Balance Sheet
45
Neutral
The balance sheet shows a moderate level of financial stability with a high debt-to-equity ratio and declining equity base. ASOS has a substantial amount of total debt compared to its stockholders' equity, which may pose challenges in managing financial obligations. However, the company maintains a reasonable cash balance, providing some liquidity cushion.
Cash Flow
50
Neutral
ASOS's cash flow performance has shown improvement in operating cash flow, turning positive in 2024 after a negative trend in previous years. The free cash flow has also improved, although it still remains a concern due to the company's net income losses. Effective cash management will be crucial to sustain operations and facilitate strategic investments.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue2.69B2.90B3.54B3.94B3.91B3.26B
Gross Profit1.07B1.08B1.39B1.57B1.64B1.43B
EBITDA-123.00M-153.60M-79.50M140.90M325.80M278.10M
Net Income-294.30M-338.70M-223.10M-30.80M128.40M113.30M
Balance Sheet
Total Assets1.72B2.27B2.63B3.00B2.88B1.99B
Cash, Cash Equivalents and Short-Term Investments220.70M382.90M353.30M323.00M662.70M407.50M
Total Debt731.80M977.70M1.00B856.00M792.10M313.10M
Total Liabilities1.40B1.75B1.76B1.98B1.85B1.18B
Stockholders Equity320.80M521.30M866.70M1.01B1.03B810.30M
Cash Flow
Free Cash Flow87.10M160.30M-190.60M-313.50M52.60M279.20M
Operating Cash Flow96.20M196.70M-12.70M-130.60M209.70M395.80M
Investing Cash Flow40.20M-133.50M-177.90M-182.90M-443.50M-116.60M
Financing Cash Flow-248.40M-26.00M222.70M-26.30M489.10M143.70M

ASOS plc Technical Analysis

Technical Analysis Sentiment
Negative
Last Price283.50
Price Trends
50DMA
311.36
Negative
100DMA
308.77
Negative
200DMA
333.07
Negative
Market Momentum
MACD
-11.06
Positive
RSI
40.06
Neutral
STOCH
27.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:ASC, the sentiment is Negative. The current price of 283.5 is below the 20-day moving average (MA) of 297.67, below the 50-day MA of 311.36, and below the 200-day MA of 333.07, indicating a bearish trend. The MACD of -11.06 indicates Positive momentum. The RSI at 40.06 is Neutral, neither overbought nor oversold. The STOCH value of 27.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:ASC.

ASOS plc Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
69
Neutral
£1.17B10.705.01%1.17%2.71%-34.19%
61
Neutral
$17.97B12.87-5.30%2.97%1.26%-14.45%
55
Neutral
£486.43M46.726.87%9.45%-57.24%
49
Neutral
£633.46M890.75%0.51%2.62%-129.82%
46
Neutral
£328.80M-62.59%-15.86%-18.46%
45
Neutral
£416.45M-27.20%-14.37%-28.78%
38
Underperform
£178.18M-185.68%-45.91%-120.22%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:ASC
ASOS plc
283.50
-151.90
-34.89%
GB:DEBS
boohoo group Plc
14.00
-15.70
-52.86%
GB:AO
AO World
86.70
-22.90
-20.89%
GB:CURY
Currys plc
128.70
52.29
68.43%
GB:THG
THG
27.68
-31.57
-53.28%
GB:MOON
Moonpig Group Plc
198.00
-4.60
-2.27%

ASOS plc Corporate Events

Executive/Board ChangesBusiness Operations and Strategy
ASOS Announces Strategic Board Changes to Drive Growth
Positive
Jul 31, 2025

ASOS plc has announced significant changes to its Board, appointing Natasja Laheij as the new Chair and William Barker as Deputy Chair. These appointments are part of a strategic move to strengthen the company’s leadership as it continues to focus on sustainable and profitable growth. Natasja brings extensive experience in international commercial and financial management, while William’s expertise in building and turning around digitally-enabled businesses will support ASOS’s strategic initiatives. The changes are expected to enhance ASOS’s operational capabilities and drive long-term competitive advantage.

The most recent analyst rating on (GB:ASC) stock is a Hold with a £4.00 price target. To see the full list of analyst forecasts on ASOS plc stock, see the GB:ASC Stock Forecast page.

Business Operations and StrategyRegulatory Filings and Compliance
ASOS Appoints KPMG as New External Auditor
Neutral
Jul 30, 2025

ASOS plc has announced the appointment of KPMG LLP as its new external auditor following a competitive tender process, with the transition set to occur for the year ending 29 August 2027. PricewaterhouseCoopers LLP, the current auditor since 2008, will continue in their role until the audits for the years ending 31 August 2025 and 30 August 2026 are completed. This change reflects ASOS’s commitment to rigorous financial oversight and may impact its operational transparency and stakeholder confidence.

The most recent analyst rating on (GB:ASC) stock is a Hold with a £450.00 price target. To see the full list of analyst forecasts on ASOS plc stock, see the GB:ASC Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
ASOS Grants CFO Award Under Value Creation Plan
Positive
Jul 2, 2025

ASOS Plc announced that Aaron Izzard, the Chief Financial Officer, has been granted an award under the ASOS Plc Value Creation Plan (VCP), which was approved by shareholders in August 2024. This award allows Izzard to potentially receive 5% of the growth in value above £6.70 of 5.5% of the company’s issued share capital. This move is part of ASOS’s strategy to align executive incentives with shareholder interests, potentially impacting the company’s operational focus and market positioning by motivating key leadership to drive value growth.

The most recent analyst rating on (GB:ASC) stock is a Hold with a £4.60 price target. To see the full list of analyst forecasts on ASOS plc stock, see the GB:ASC Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
ASOS Appoints Aaron Izzard as New CFO Amid Strategic Transition
Positive
Jun 17, 2025

ASOS has announced a significant leadership transition with Aaron Izzard appointed as the new Chief Financial Officer and Executive Director, effective from July 1, 2025. This change marks a strategic move as ASOS transitions from financial recovery to a focus on sustained operational execution and long-term growth. Aaron’s extensive experience in retail and e-commerce, particularly in driving cost-efficiency and operational improvements, positions him as a key asset for ASOS’s continued transformation. The outgoing CFO, Dave Murray, is recognized for his contributions to the company’s financial strengthening and stock reduction, leaving ASOS in a more robust and resilient state.

The most recent analyst rating on (GB:ASC) stock is a Hold with a £4.60 price target. To see the full list of analyst forecasts on ASOS plc stock, see the GB:ASC Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 19, 2025