We are maintaining our fair value estimate for no-moat Asos following the group's decision to offload a majority stake in the Topshop and Topman brands, which we take positively. The shares remain deeply undervalued, trading at 0.3 times forward revenue and 7 times EBITDA.
Asos has significant room for expansion outside its home market to the rest of Europe and the U.S., where it has low-single-digit share in the online market.
Asos operates in the midmarket segment, the slowest-growing segment of apparel. This can hurt the company’s growth as customers trade up and down.
|
Metric
|
ASC
|
AMZN
|
HM B
|
|---|---|---|---|
Price/Earnings (Normalized) | — | 42.56 | 26.70 |
Price/Book Value | 0.84 | 8.07 | 6.34 |
Price/Sales | 0.16 | 3.20 | 1.17 |
Price/Cash Flow | 19.15 | 16.85 | 7.79 |
|
Metric
|
ASC
|
AMZN
|
HM B
|
|---|---|---|---|
Quick Ratio | 0.61 | 0.88 | 0.55 |
Current Ratio | 1.51 | 1.10 | 1.11 |
Interest Coverage | −3.66 | 19.26 | 9.78 |
|
Metric
|
ASC
|
AMZN
|
HM B
|
|---|---|---|---|
Return on Assets (Normalized) | −1.65% | 12.54% | 5.64% |
Return on Equity (Normalized) | −5.91% | 32.13% | 22.48% |
Return on Invested Capital (Normalized) | 0.29% | 18.92% | 10.13% |
|
1-Day Chart
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United States