A month ago, we upgraded FY26 forecasts, and warned that this highly impressive turnaround had more to offer, and was not priced in. After yesterday’s update outlined rapidly improving trends in Active customers, confidence has stepped up regarding an inflection to top line growth. Having already delivered substantial progress on gross margin and structural/variable cost after 3 years of heavy lifting, ASOS is now poised to inflect to a geared profitable growth phase. We have therefore upgraded FY26 forecasts again and nudged up outer years. On 3.5x cal’26 EV/EBITDA, falling to just 3x in cal’27 incl. the £50m bond redemption premium, there is scope for investors to make outsized returns on continued good execution. Buy.
