Boohoo Shares – Is It Time To Flip Bullish?

Boohoo (LON: BOO) is down bad…

The online fashion retailer’s shares have tumbled over 65% in 2022 and more than 77% in the last 12 months. 

It is the most shorted London-listed stock, and the company revealed in its interim results in late September that revenue had declined 10% YoY.

See, while luxury fashion demand has remained resilient, at the lower end of the scale, it has eased with soaring inflation hitting consumer wallets and supply chain challenges and cost inflation also playing a part.

In addition, Boohoo’s interims for the six months that ended August 31 were significantly impacted by returns.

But with the latest UK retail sales data coming in above expectations and the Christmas period on the horizon, are we seeing a rise in demand metrics? Should we be looking for upside in Boohoo shares?

A Mentions Spike

This data is slightly incomplete due to some technical issues over the last week or two, but it still gives us great insight into current Boohoo demand trends. 

The graph represents the number of times Boohoo has been mentioned on Twitter weekly. 

As we can see, at the start of November, there was a significant spike following a period of stabilisation.

Is this a sign of a change in momentum…maybe?

Google Searches 

According to Google Trends data, UK searches for Boohoo have also stabilised after a decline since November last year  — the UK market makes up the majority of Boohoo’s revenue.

Still, it has yet to rise, although the dotted line, which represents incomplete data, signals a spike in searches over the last week from November 13 to 19.

That jump would put it back around December 2021 levels.

Web Traffic 

While Twitter mentions and Google Trends have shown positive signs, web traffic provided by Semrush is somewhat inconclusive. 

There was a decline in visits to Boohoo.com in October, and while November suggests traffic will come in lower, that could still change, given we are just over halfway through the month.

Nevertheless, we have to wait and see.

Bottom Line: There is no doubt the macroeconomic environment has significantly weighed on Boohoo since the end of 2021, but there has been some stabilisation in its demand metrics in recent weeks — probably due to the upcoming Christmas period.

Of course, Boohoo the company, has other brands, such as boohooMAN, PrettyLittleThing, Nasty Gal, MissPap, Karen Millen, and coast under its banner, but the Boohoo brand and name provide us with a solid base for current demand trends at the company.

While we definitely can’t yet call upside in Boohoo shares, given the current macroeconomic climate, we are keeping a close eye on demand data for a more sustained turnaround. 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s