ASOS - better than expected Finals show that big profits are coming back again, now 413.50p the shares are looking attractive

Mark Watson-Mitchell - 06.11.2026

"We are back to growth, and it is spreading"

Yesterday's 2026 Final Results from ASOS (LON:ASC), the £496m-capitalised online fashion retailer, were better than market expectations, while the small hit in sales last month due to a cyber-hacking will not incur any real impact on current year results, which are expected to be even better.

As I stated recently, after a few years of devastating losses the transformation really is now underway, and the profits are beginning to show through.

The group's shares hit 450p at one stage yesterday in response to the accompanying statement; however, they have eased back in end-of-week dealings to 413.50p as I write.

At this level, I remain confident of an upward price progression, with 510p being the latest SQC Research Target Price.

The Business

Founded in 2000, ASOS has more than 16m active customers in over 100 markets.

It brings fashion lovers around the world the best and most relevant fashion through its unique own brands including ASOS DESIGN, ARRANGE, COLLUSION, Topshop, and Topman, styled with the most exciting products from local and global partner brands.

With its expert in-house design team and agile and flexible commercial model, including ASOS Fulfilment Services, Partner Fulfils, and Test & React, it makes the latest trends accessible to all and gives customers the confidence to be whoever they want to be.

Final Results

Yesterday ASOS reported that its FY26 GMV was £2,349.0m (‑5% YoY, improving to ‑1% in H2 with Q4 returning to YoY growth) and adjusted group revenue £2,240.3m (‑9%); adjusted gross margin expanded to 50.5% (+340bps) and adjusted EBITDA rose to £170.3m (+29% YoY) delivering adjusted EBIT of £18.8m (vs a £32.2m loss prior year).

Net debt reduced to £109.3m (down >40%), aided by £115.5m of asset disposals, while free cash flow was negative £16.4m.

The Board guides FY27 to low-single-digit GMV growth, adjusted EBITDA £180–200m, capex ~4% of revenue and positive free cash flow; the 6th October cyber incident is estimated to have cost ~2–4% of Group GMV, but trading is described as resilient.

Financial Review

The Group's financial performance in FY26 represents a year of meaningful progress, with the benefits of the transformation programme becoming increasingly evident across profitability, customer metrics and trading performance.

The Group strengthened its financial position through debt refinancing, enhanced liquidity with the disposal of the Atlanta and Lichfield warehouses, whilst continuing to improve the economics of the business through gross margin expansion, disciplined cost control and supply chain efficiencies.

This created the flexibility to reinvest in growth initiatives, supporting improved customer engagement, four consecutive quarters of strengthening GMV performance and a return to growth in Q4.

Collectively, these actions have delivered a substantial improvement in profitability and established a stronger platform for sustainable profitable growth in FY27.

"We are back to growth, and it is spreading"

The Equity

There are some 119.82m shares in issue.

The larger holders include Frasers Group (18.61%), Camelot Capital Partners LLC (17.16%), Schroder Investment Management Ltd. (4.96%), The Goldman Sachs Group Inc. (2.84%), Nicholas Robertson (2.20%), Hosking Partners LLP (1.43%), Clearstream Banking (0.67%), Hargreaves Lansdown Fund Managers Ltd. (0.54%), LGT Capital Partners AG (Investment Management) (0.49%), and HSBC Global Asset Management (UK) Ltd. (0.43%).

Broker's Views

There are some 13 brokers following the group, with the average view for the shares to Outperform.

Four brokers say Buy, seven say Hold, one to Outperform and the other to Underperform.

The average Target Price is 466p, the Lowest TP is for 250p and the Highest goes for a 750p TP.

Berenberg Bank has a Buy note out on the group with that 750p TP, while Shore Capital Markets say Buy with a 520p TP.

My View

At 413.50p, I remain confident of an upward price progression, with 510p being the latest SQC Research Target Price.

(Profile 21.09.26 @ 421p set a Target Price of 510p)