A once-in-a-decade opportunity to buy cheap boohoo shares?

when boo group (LSE: BOO) shares opened in 2014, they opened at 85p. Now, not far from a decade later, we can buy it for under 55p.

I wonder how many back then think that can happen? No one buys early, I’ll bet.

boohoo’s share price fell in the first few months. But it didn’t last long, like many new growth stocks before it.

By the end of 2020, the highest price was over 400p. This is during Covid, when cash is increasing into online retail stocks.

And at its peak, the stock’s price-to-earnings (P/E) ratio reached nearly 80.

fall

I think correction is always on the cards. But I didn’t expect it to suddenly become so big. Not when I bought it on the way down, of course.

Do we now have a chance to start over? Well, boohoo dipped to 30p at one point, so we can skip the bottom.

But a few things make me think boohoo has what it takes to become a top growth stock buy again. And not only because the price is up, close to 50%, since the beginning of 2023.

Store

It looks like confidence can return to the retail sector, and to the fashion market.

Next Stocks have risen since the end of 2022, although high inflation has lasted longer than expected. Prices are up more than 50% from last year’s lows. And now it’s up 40% in five years.

and Marks and Spencer fly, up more than 70% since last year’s low point. I can even rate M&S shares now, when they are still down 40% in five years.

If consumers start shopping in brick and mortar stores again, it might help boohoo. The company opened a pop-up store in London this month, and has been trying something similar.

I’ll have to watch out for higher street moves next year.

Evaluation

I may be confident about boohoo, but there is still an obvious risk here. The main thing, I think, is probably the price.

The forecast shows no profit for at least two years. That means there isn’t much that can be gleaned from the basic steps.

Basic earnings are expected to rise sharply, though. And the City expects positive free cash flow by 2025.

That’s good, but growth investors want to see enough to keep the stock price going up again. And despite this year’s results, I’m not sure we have shown that yet.

buy?

The result for the year ending February will come on 16 May. And the last update from the company said that it will make a profit of 35% compared to 2020.

That’s from before Covid, so it shows some kind of long-term trend. But we need to know when we can return to profitability and cash flow.

Will I buy it? Now, I think some dividend stocks are better and less risky. But I will also watch boohoo.