Analysts believe it is just a matter of time before online fashion giant ASOS exceeds high street stalwart Marks & Spencer’s market value.
Yesterday AIM-listed ASOS had a market capitalisation of £4.93bn compared to Marks & Spencer’s £5.03bn which one analyst, Mark Photiades of Cantor Fitzgerald, pointed out to The Times was the closest the two business’ valuations had ever been.
“We believe that it will not be long before Asos has a greater market value than M&S. It will be a seminal moment,” he told the publication.
Photiades also pointed out that 20 years ago, before ASOS was founded, M&S had been worth £16.9bn. ASOS was founded in 2000 by Nick Robertson and was floated on AIM for £14m in 2001. The drop in valuation of M&S in the interim and the meteoric rise of ASOS exemplifies the fundamental structural change in the retail industry in favour of online shopping but is also indicative of the disappointing performance of M&S in recent years.
ASOS last month reported it was “on track” to deliver its targets in this financial year as it posted a 32% rise in retail sales to £498.3m in the four months to 30 June (and a 36% rise in the financial year to date). Last year the businesss made a profit of £42.8m on £1.44bn of sales while M&S made a £176m profit on £10.6bn of sales.
