The predictions made in this magazine are just that. The value of your investments and the income derived from them may go down as well as up. You may not get back all the money that you invest. theplc.london | 7th March 2015
boohoo.com The stock that could make you a millionaire
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SOS went public in October 2001. On the 4th August 2003, their shares were worth 3.5p. On 6th January 2014 their shares were worth 7008p. That is an increase of 2002.3 times or 200,230% in just 13 years, so if you had invested £10,000 on 4th August 2003, you could have sold your shares on 6th January 2014 for over £20 million. The fashion industry has, for a long time now, been extremely profitable for those with access to big finance. Philip Green, owner of Arcadia, has an estimated fortune of £3.88 billion and the owners of Matalan, New Look, Monsoon, Mulberry and River Island are not doing badly either. The functional/psychological benefits that clothing offers is timeless, as is the overwhelmingly powerful female instinct for going shopping. Even the most determined boyfriend/husband cannot subdue a lady’s desire to conduct her ritualistic weekly wardrobe update. Once upon a time, women had to physically leave their homes to get to the shops but with the advent of e-commerce, first popularised by Amazon, this obstacle no longer exists... And if that had not helped the online fashion industry enough, these days most women also own a laptop, a tablet and a smart phone from which to shop from. The bottlenecks are reducing at an alarming rate. It would not surprise me if the true incentive behind the accelerated advancement in connectivity, augmented reality and even graphene, has more to do with the Holy Grail of commerce, i.e. the lady’s psyche, than progress itself. The founders of boo. com were obviously aware of this intelligible truth, unfortunately for them, the Dot.com bust ruined them when investors, encouraged by the media, decided to offload all their shares, just as Boo’s sales
were beginning to rocket. Let me repeat that, their sales were rocketing in an age of pre-broadband, in a time when it was unheard of for women to buy clothes without first trying them on. After the stock market began to normalise, and after many hard lessons had been learnt, industry bankrolled a second attempt. ASOS have been astonishingly successful and when the First Lady is endorsing such a business, the powers that be must certainly be aware of one or two things. As successful as ASOS has been though, I have noticed a rather peculiar detail. When you type ASOS into Youtube the first video with a significant number of views is titled ASOS Clothing Haul! which managed to rack up an impressive 341,228 views... But when you type Boohoo into Youtube a video titled Boohoo Haul & £500 Giveaway | Zoella appears at the top, which has so far managed to rack up a much more impressive 2,039,514 views. This would suggest that more people are searching for Boohoo than ASOS on Youtube and is surely a good indicator that Boohoo generates more online traffic than ASOS in general. And if that is the case, if trends continue, it would seem that Boohoo sales are destined to overtake ASOS sales, at least in the UK, very, very soon. From a subjective view point though, you just need to take a peak at Boohoo's website. The presentation is lightyears ahead! And as we all know, when it comes to fashion, image is everything. Boohoo is a high growth company, in a high growth industry, who's sales are not far behind the largest online fashion retailer in the UK and yet, it is still a penny stock. For that reason, I believe it is a good time to invest in Boohoo. Who knows, today could be 4th August 2003 all over again! For Boohoo’s Quarterly Earnings: www.boohooplc.com