Fast-fashion online retailer (BOO:AIM) continues to raise smiles from investors, the shares surging another 6.4% higher to a record 79.25p on news full-year results should smash market expectations.

Following a stellar first five months of the financial year, Boohoo raises its annual sales and EBITDA guidance, prompting analysts upgrade forecasts once again.

Click here to read today's surprise update from Manchester-headquartered Boohoo, the high-growth own-brand fashion etailer set to strut in with interims to 31 August next month (27 Sep). Joint CEOs Mahmud Kamani and Carol Kane buoy investors' spirits with news of a superb opening five months of the financial year to February 2017 and an encouraging start to the month of August.

boohoo Menswear SS14 005

'Demand has been robust and sales momentum in the first quarter has continued into the second quarter,' says Boohoo, adding 'sell through of seasonal stock has been strong through the Spring and Summer season.'

'Consequently, the board now anticipates that the results for the current year will be above expectations with increased sales growth of between 28% and 33% (against previous guidance of 25% to 30%). As a result of operating leverage in the business, the board currently anticipates improved EBITDA margins for the financial year and further guidance will be given at the interim results in September.'

Alongside the likes of larger peer ASOS (ASC:AIM), Boohoo is well positioned to capture further market share as part of the continued digital channel shift, which has been accelerated in the past two years by the advent and capabilities of smartphones. During the second quarter, Boohoo's growth exceeded expectations across the UK, Europe and the Rest of the World segments.

Boohoo's key strengths include a dedication to selling own-brand product, which supports high margins, a ‘test-and-repeat’ model that limits fashion risk, as well as keen pricing and sector-leading social media engagement. Investors have chased Boohoo's shares higher post-Brexit, as weaker sterling should give a translation benefit from its Euro and US businesses.

In a note entitled 'Boohoo – Hotter than Wasabi!', Shore Capital's George Mensah says he has bumped up his February 2017 sales estimate from £251.5 million to £257.1 million, implying a stellar year-on-year growth rate of 31.6%. The analyst has also upgraded this year's EBITDA estimate by 10.8% to £26.6 million.

Web chart - BOOHOO - Aug 16

Shares highlighted the growth attractions of Boohoo and the potential for upwards earnings revisions in our Small Caps section here in March, when the shares were trading at 41p.

Issue Date: 09 Aug 2016