After a nightmare period for the shares, independent analyst Alistair Strang gives his view on the internet fashion retailer.
When we previously reviewed Boohoo Group (LSE:BOO) last October, when the price was 277p, we wrote: "We find ourselves in the ridiculous position of being forced to mention the lowest we can calculate is 65p."
Alas, the share price has endured a painful journey, eventually hitting and breaking our 65p, currently trading at 60p!
There are some early signs that the online shopping company faces slight improvement in their share price, as above just 61.5p calculates with the potential of price recovery to an initial 69p. If exceeded, our longer term secondary works out at a more encouraging 79p.
When viewing the chart for the last few years, these target levels hardly deserve any sort of headline billing (unlike the weather) as, visually, the share price now needs to trade above 100p to be taken seriously, exceeding a glass ceiling which has formed this year and giving some reasonable hope for a future of sorts.
Past performance is not a guide to future performance.
Unfortunately, it's also a worry that the share price has closed, repeatedly, below our 65p as optimism can prove difficult in such a scenario.
The Big Picture situation is now pretty risky, with weakness below 52p threatening reversal to an initial 39p with secondary, if broken, at a new "ultimate bottom" price level of just 7p. Which would be a big boohoo for Boohoo investors.
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea.
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