Where will the boohoo share price go next? Here’s what the forecasts say

Faltering fashion favourite boohoo’s share price is hitting the headlines. Sounds like it might be time to take stock of forecasts.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Back when I bought some, the forecasts for the boohoo (LSE: BOO) share price were strong.

It turns out they were badly wrong. But I think it was mostly due to problems we really couldn’t see at the time. At least, I didn’t see them.

Created with Highcharts 11.4.3Boohoo Group Plc PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.co.uk

The experts

Having been stung once, why care about what the so-called experts think now? I could say their guess is as good as mine. And that would probably be true.

Should you invest £1,000 in Alpha Group right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Alpha Group made the list?

See the 6 stocks

But also we’re looking at a company making a loss, with the success of its turnaround plans very much up in the air. And in cases like this, it surely pays to listen to all opinions before making any decision about buying.

Oh, or selling, of course. I could probably get myself a new pair of socks with the proceeds if I sell now.

Hello, Mike

But what about the Mike Ashley and Frasers Group drama? Frasers currently holds a 27% stake in boohoo. And the firm posted an open letter to the boohoo board on 24 October.

It’s summed up by: “Frasers is requisitioning a general meeting of boohoo to appoint Mr. Mike Ashley as a director and CEO of boohoo and Mr. Mike Lennon as a director of boohoo, to take effect without delay. Frasers firmly believes that these appointments are in the best interests of boohoo, its shareholders and its stakeholders”.

The boohoo board doesn’t seem too keen on the idea. Ashley can be a divisive figure. But he has a decent track record of saving (some) troubled companies.

If he gets his way, forecasts might all need to be rewritten. But I think it’s worth taking a new look at them to help get a feel for the lie of the land.

No profits

The big red flag is a lack of profit for the next few years. Analysts still show negative earnings per share (EPS) as far out as 2027. The losses look set to reduce by then. But in a time when I’d say competition is only likely to intensify, I’m not thrilled.

As for the share price, there’s an average target of 32.5p out there. And the range goes from 18.5p to 70p.

With boohoo shares trading at 29p at the time of writing, that upper bound suggests an attractive 140% gain. But is it enough to offset the risk of a 36% loss if the most bearish forecast is right?

Either way, the wide range of opinions reinforces my thought that the experts really don’t have much more clue than me.

What to do

Despite my lack of excitement, I do see some intriguing possibilities. Is it worth buying with the idea that the current management can drag boohoo back from the brink? If Ashley sees long-term value in the company, that’s a plus.

Or buy in the hope that Ashley will take the reins and steer the company to success? I really don’t know.

But I’ve decided one thing. There’s too much entertainment value for me to sell my meagre stake right now. Besides, I have enough socks.

Should you buy Alpha Group now?

Don’t make any big decisions yet.

Because Mark Rogers — The Motley Fool UK’s Director of Investing — has revealed 5 Shares for the Future of Energy.

And he believes they could bring spectacular returns over the next decade.

Since the war in Ukraine, nations everywhere are scrambling for energy independence, he says. Meanwhile, they’re hellbent on achieving net zero emissions. No guarantees, but history shows...

When such enormous changes hit a big industry, informed investors can potentially get rich.

So, with his new report, Mark’s aiming to put more investors in this enviable position.

Click the button below to find out how you can get your hands on the full report now, and as a thank you for your interest, we’ll send you one of the five picks — absolutely free!

Grab your FREE Energy recommendation now

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Alan Oscroft has positions in Boohoo Group Plc. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our best passive income stock ideas

Do you like the idea of dividend income?

The prospect of investing in a company just once, then sitting back and watching as it potentially pays a dividend out over and over?

If you’re excited by the thought of regular passive income payments, as well as the potential for significant growth on your initial investment…

Then we think you’ll want to see this report inside Motley Fool Share Advisor — ‘5 Essential Stocks For Passive Income Seekers’.

What’s more, today we’re giving away one of these stock picks, absolutely free!

Get your free passive income stock pick

More on Investing Articles

Investing Articles

2 FTSE 100 and FTSE 250 stocks to consider as stock markets plummet!

Looking for lifeboats as growth-crushing trade tariffs loom? Here are two (including a FTSE 100 gold stock) I think merit…

Read more »

Number three written on white chat bubble on blue background
Investing Articles

Just released: the 3 best growth-focused stocks to consider buying in April [PREMIUM PICKS]

Our goal here is to highlight some of our past recommendations that we think are of particular interest today, due…

Read more »

Happy young plus size woman sitting at kitchen table and watching tv series on tablet computer
Investing Articles

£10,000 invested in Watches of Switzerland shares 1 year ago is now worth…

Watches of Switzerland shares have been decimated by Trump’s tariffs on Switzerland. Dr James Fox explores whether this is an…

Read more »

Hand flipping wooden cubes for change wording" Panic " to " Calm".
Investing Articles

Growth stocks are crashing! Here’s what I’m doing now

Our writer shares his thoughts as growth stocks get crushed, as well as a favourite from the Nasdaq that he…

Read more »

Investing Articles

What’s going on with the Nvidia share price now?

The Nvidia share price is tanking. Once the most valuable listed company, Nvidia has seen more than $1trn wiped off…

Read more »

Investing Articles

This FTSE AIM stock has £2.3bn in net cash, and a market cap of £2.4bn!

I love this FTSE AIM stock, but it really hasn’t delivered for me yet. The stock trades with crazily low…

Read more »

Smart young brown businesswoman working from home on a laptop
Investing Articles

Down 15% in a week! Are these 5 FTSE 100 fallers screaming buys as markets plunge?

Five of Harvey Jones's favourite FTSE 100 stocks all have the same thing in common – they've fallen around 15%…

Read more »

Hand of person putting wood cube block with word VALUE on wooden table
Investing Articles

2 stocks that have been crushed and now offer a ton of value

Edward Sheldon has been scanning the market for stocks that offer value after the sell-off. Here are two shares he…

Read more »