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Asos offers sustainable online exposure

The online clothing retailer is thriving as shoppers embrace the internet
Asos offers sustainable online exposure

A July trading update from Asos (ASC) announced expectations of healthy full-year profit growth, despite weak consumer sentiment and against a backdrop of growing concerns surrounding the sustainability of clothing production. The retailer is riding a trend towards online shopping and has taken swift action to ensure it can both capitalise on changing consumer behaviour, and survive the coronavirus pandemic.

IC TIP: Buy at 3,358p
Tip style
Growth
Risk rating
Medium
Timescale
Medium Term
Bull points

Sales have recovered since coronavirus outbreak

Strong balance sheet

Improving sustainability credentials

Shoppers are embracing online sales channels

Bear points

Margins have weakened under shifting product mix

Shares are expensive on an earnings basis

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