Citi upgrades Boohoo.com to 'buy'

In the wake of a 30% drop in the shares over the past seven months, Citi opted to upgrade its recommendation on Boohoo.com to 'buy', setting a target price of 235p.

"We think shares and consensus forecasts now better reflect downside risk on margins as company invests for long term growth. Social media shows potential of boohoo brands," the broker said to clients in a research note.

To back up its case, the broker pointed to rival PrettyLittleThing, which had more than twice the engagement of 'Asos' or Boohoo brands.

In its opinion, that served to underline that sales had yet to scale to potential and underpinned its near-term growth forecasts.

On the other hand, the analysts trimmed their forecasts for the group's profits before tax by between 6% and 9% to better capture planned reinvestment in all group brands.