AO World – good sales growth and even better profits heighten the investor appeal at just 90.80p

Mark Watson-Mitchell - 19.06.2026

A couple of days ago the UK’s most trusted electrical retailer AO World (LON:AO.) reported its Final results for the year to end-March.

It showed revenue growth of 11.4%, while its adjusted pre-tax profits were up 16.1% to a record £50.5m.

The £504.5m-capitalised group’s shares were up to 116.80p in mid-January this year, since when they have been down to 82.70p, that was at the end of March.

They are now looking steadier at 90.80p, at which the whole group is capitalised at £547.73m.

I now see them rising well over the 100p barrier, then edging up to 120p and higher.

The Business

This online electrical retailer offers major and small domestic appliances and a range of mobile phones, Audio Visual, consumer electricals and laptops.

It also provides ancillary services such as the installation of new and collection of old products and offers product protection plans and customer finance.

The Bolton-based company also serves the business-to-business market in the UK, providing electricals and installation services at scale.

It also has a Waste Electrical and Electronic Equipment processing facility, ensuring customers' electronic waste is dealt with responsibly.

The group’s official AO Outlet eBay store gives its customers the chance to make savings, selling over 9,000 different electrical products on ao.com.

It has three mobile brands: mobilephonesdirect.co.uk, affordablemobiles.co.uk and buymobiles.net.

The recently acquired Music Magpie serves as its sales platform in the UK, across both musicmagpie.co.uk and its respective mobile applications.

The 2026 Final Results

AO World reported strong financial results for the year to end-March, with revenue growing 11.4% to £1,266.6m and adjusted profit before tax increasing 16.1% to a record £50.5m.

The company also achieved a significant strengthening of its balance sheet, moving from net debt of £35.9m to net funds of £16.4m, supported by free cash flow of £66.4m.

Reflecting this performance, AO World intends to return £20m to shareholders through a £10m special dividend and a new £10m share buyback programme.

The company anticipates delivering FY27 profit before tax in line with current market expectations.

Looking ahead, the external environment remains uncertain, with ongoing geopolitical volatility and continued inflationary pressures impacting both consumers and input costs across the economy. 

Management Comment

CEO John Roberts stated that:

"These results represent an incredible team effort with revenue up 11% to £1.27bn, profit up 16% to a record £50.5m, and the strongest balance sheet in our history.

And all delivered against a backdrop of rising costs.

We've also become the first retailer in the world to exceed one million Trustpilot reviews at an overall rating of 4.9 out of 5.

In a category as demanding as ours, that trust is hard-won and almost impossible to copy.

It sits nowhere on our balance sheet, yet it's among the most valuable things we own.

AO Membership continues to go from strength to strength and there's more to come with the launch of Switch24 and AO Mobile, which combined, are the best way to get the latest iPhone paired with an all-you-can-eat SIM at a market-leading price.

It's scaled economies shared and is exactly what our members want at a time when every pound counts.

We've also announced today our intention to return a further £20m to our shareholders, which is a reflection of the cash this business now generates and the discipline with which we allocate it.

None of this is the work of one person.

It's down to every AOer and every partner who shares our obsession with looking after customers.

I started AO 26 years ago with a small team and a big idea and I'm as excited about the next 26 as I've ever been."

The Equity

There are some 570.55m shares in issue.

The larger holders include Camelot Capital Partners (20.76%), Rothschild & Co. Bank AG (15.10%), Odey Asset Management (5.22%), Lancaster Investment Management (5.07%), Phoenix Asset Management Partners (2.99%), Waystone Management (UK) (2.26%), Union Bancaire Prive (1.79%), Vanguard Capital Management (1.52%), BlackRock Investment Management (UK) (1.32%), and Premier Fund Managers (1.20%).

Broker Views

There are four firms following the group, three of whom call the shares as a Buy, the other as a Hold.

Following this week’s results, analyst Andrew Wade, at Jefferies, put out a Buy note, with an increased Target Price at 160p (155p).

He made a big play on the group achieving an outstanding rating with Trustpilot.

AO has reached an impressive milestone of being the first retailer in the world to garner 1m Trustpilot reviews on the consumer rating platform, earning an ‘outstanding’ 4.9-star rating.

“It is the first retailer on the planet to achieve this fear and, rightly so, chief executive John Roberts notes that the business is hugely proud of it.”

Wade said:

“It is an achievement that deserves recognition highlights AO’s deep engagement with its customers and evidences its strong brand and outstanding service proposition.”

He expects this to continue given the expansion of its membership model to deliver premium growth for the foreseeable future.

Analyst estimates for the current year to end-March 2027 are centred around £1.35bn (£1.27bn) revenues, with adjusted pre-tax profits of £53.5m (£50.5m), lifting its earnings to 6.5p (6.1p) per share.

For the 2028 year, sales of £1.42bn could boost profits to £63.0m, generating 7.6p in earnings per share.

At Peel Hunt, analyst John Stevenson has a Buy out on the shares, with a 137p Target Price.

He noted that as free cashflow is building at £40-60m per annum, enhanced returns are likely to remain a feature.

It is worth noting that analysts Caroline Gulliver and Hannah Crowe, at Equity Developments, consider that the group’s shares have a ‘fair value’ of 170p each.

My View

I really like AO World, its basic business model and its attitude to service, it is no surprise that it is so highly regarded on Trustpilot.

Now, at just 90.80p, I believe that this group’s shares are too cheap.

I am sure that we will soon see them recovering in price, with a clear objective of breaking through the 2026 High of 116.80p.

It could well happen before its AGM on Thursday, 24^th September.

(Profile 17.09.24 @ 106.50p set a Target Price of 136p)

(Profile 18.06.25 @ 100.30p set a Target Price of 120p)

(Profile 10.04.26 @ 89p set a Target Price of 110p)