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The city view - ASOS
Evolution Securities initiated coverage of ASOS with a 'Buy' recommendation on the back of its view that the company has plenty of scope for further underlying growth.
Although ASOS trades on a high PE of 26x the broker forecasts it will achieve a CAGR (Compound Annual Growth Rate) in earnings for 2008 through 2011 of 60% even after a fall-off in its turnover growth from 85% in 2009 to a more modest 20% in 2011.
Evolution has set a price target of 450p, compared with an underlying share price of 318.25p, with the next catalyst for uplift in its shares likely to come from the company's AGM in early October.
Tagged as: asos | city broker view
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