SHORT
Current price: 43.48
AO Group share price forecast (10 days): 35.0
Stop loss: 50.00
AO Group is a leading retailer in the UK and Europe with over 400 stores. The company has a strong presence in the UK, Germany, France, Spain, and Italy. AO Group is a publicly traded company currently listed on the London Stock Exchange (LSE: AOG) and is part of the FTSE 250 Index.
Since Jan 2021 the shares have dropped from 417.50 to 43.94 which is a huge drop, helped by profit warnings, harsh trading conditions and continued poor outlook.
AO World have a market cap of £248.94m with net profits of £17.7m in 2021 so its trading at around 14.6x net profit to market cap which is just about acceptable.
They have a net debt of £104m which is on the high side in relation to net profits.
Website traffic is down considerably since the last trading statement, which makes me think overall sales are also down considerably.
It looks like they’ve lost close to 1.8m visitors to the site. With a 2% conversion rate, that’s 36,000 less transactions online equalling approximately £12.6m in revenue.
AO World have an upcoming earnings release which looks like it could be negative. If you want to trade this share, I would be looking to go short.
