Instead of foreseeing the future, investors must accept the reality and lower their expectations
Sales warning can give huge impact to a company. Asos, which performed well in previous months, had no qualms or new issues as it stated in its interview a week ago and the price of its shares went back to about 14%.
The public is asking has the company fully recovered? Will the investors commit or be wary on the huge prize? According to the chief executive official, it is the global leader in fashion for young consumers. The next move is set to have about 2.5p billion, which was way too far from the previous year's figures.
With the latest rate of development, more than 25% increase in profit, with Britain performing better-the brand will surely have the opportunity to reach its dreams for the next six years. The main issue here is the amount of investment that is needed to fund the development, and the extent of income will be attained once it hits the destination.
In the previous year, the Asos followers perceived that the organization can run with before tax income of about 8%. However, that is not yet official of the moment. The official of the company
has already confirmed that the company will have to run at about 5% as it goes through transition to improve its system and adjusts in local market pricing. It was actually the pricing that caused issues in the previous year and when the currency improved and young consumers from Russia and Australia realized that their apparel became expensive.
Based on the analysis, the company can get 6% of its profit until 2019. It will be an outstanding performance if that happens. However, provided that the income is projected to be flat in the current year, there will definitely be doubts along the way.
