LAST year was huge for Asos. As the online retailer launched both Russian and Chinese language sites and increased sales by 40 per cent from 2012, shares rocketed – climbing 140 per cent in just 12 months and giving the firm a market capitalisation of close to £6bn.
That’s huge. If chief executive Nick Robertson chose to make the jump from Aim to main market listing, Asos’ size would put it among some of the FTSE 100’s big hitters – up there with Burberry, EasyJet and newcomer Royal Mail.
Yesterday’s results were equally impressive; UK retail sales shot up 37 per cent in the period, and the EU saw a staggering 69 per cent increase.
So it’s no wonder the stock has such a high standing with investors, but also no wonder shares took a bit of a beating yesterday.
After a while stellar growth – and there’s no doubt that’s what Asos is expected to continue delivering – is nothing less than the market expects.
That, combined with mild fears over a slowdown in US and Australian growth, was enough to send shares down more than three per cent.
But investors should not be concerned. The group is still on track to beat its target of £1bn in sales next year and there’s plenty of growth left in the EU and UK markets, both of which delivered a very strong quarter.
A bit of profit taking is only natural, but no one should be afraid of sticking with Asos for the long-term.