- Basket of 10 UK fashion related stocks loses 21% of value in 5 years and is 6% down over 3 years
- There are winners and losers – JD Sports (+100%) and Frasers (+68%) have performed strongly whilst ASOS has struggled (-95%)
- UK fashion stocks look to be recovering in 2023 – basket is up 10% vs FTSE 350 year-to-date
With just a few days until London Fashion Week kicks off, new research from eToro suggests that retail investors backing the UK fashion scene would feel somewhat hard done by over the last five years.
The trading and investing platform created a basket of 10 UK listed brands with strong fashion credentials – including names such as Burberry, ASOS and Next. The basket has dropped 21% in value over the last five years, underperforming the FTSE 350 by 18% (see Table 1).
The UK fashion basket’s performance over the last three years is slightly more palatable thanks to a 2020 Covid lockdown spending boom, down just 6%, however its underperformance versus the FTSE 350 actually increases to -22% over this timeframe. This is a result of the sector’s particularly bad 2022 performance, driven by consumers scaling back on non-essential spending as the cost-of-living crisis took effect.
According to a recent ONS survey, 68% of Brits say they are spending less on non-essentials in response to the cost-of-living crisis, with 49% becoming more price conscious and shopping around more.
Commenting on the data, eToro Global Markets Strategist Ben Laidler, said: “London Fashion Week is one of the highlights of the fashion calendar and is an annual celebration of British fashion heritage. Unfortunately though for retail investors backing British fashion retailers over the last few years, there hasn’t been too much to celebrate. The industry enjoyed a Covid lockdown spending spike and share price surge but has been suffering from a cost-of-living spending hangover since then.”
Table 1: Shows share price performance of basket of 10 UK fashion stocks versus the FTSE 350
| 5-year performance | 3-year performance | 1-year performance | Year-to-date performance | |
| UK fashion basket | -21% | -6% | -11% | 10% |
| FTSE 350 | -4% | 16% | -2% | 0% |
| UK fashion basket vs FTSE 350 | -18% | -22% | -10% | 11% |
Past performance is not an indication of future results.
While the UK fashion sector may have underperformed over the last five years, there have been some clear winners and losers, with JD Sports (+100%) and Frasers (+68%) providing healthy returns over this period, whilst the likes of ASOS (-95%) and Farfetch (-82%) have lost significant value.
It is also worth noting that in 2023 the picture has started to improve for fashion retailers – the basket of stocks is 10% up year-to-date, whilst the FTSE 350 has not changed in value.
Laidler adds: “While it hasn’t been a pretty picture for the UK fashion sector in the last five years, we are seeing early signs of a share price recovery in 2023, with sentiment starting to improve as inflation and interest rates in the UK reach a peak. We should also recognise the very different fortunes of some of those in our basket. JD Sports and Frasers have delivered staggering returns for their shareholders, whilst others like ASOS, Farfetch and Boohoo have seen their share prices plummet, due to a combination of the online retail hangover, weak profitability, and cost-of-living headwinds.”
Table 2: Shows share price performance of 10 stocks included in eToro’s UK fashion basket
| Company | 5-year performance | 3-year performance | 1-year performance | Year-to-date performance |
| Burberry | 3% | 30% | 25% | 4% |
| Mulberry | -68% | 33% | -14% | 11% |
| Next | 10% | 19% | 19% | 11% |
| Boohoo | -81% | -90% | -54% | 6% |
| ASOS | -95% | -90% | -78% | -35% |
| Farfetch | -82% | -66% | -48% | 7% |
| M&S | -33% | 72% | 21% | 46% |
| Frasers | 68% | 115% | -2% | -5% |
| JD Sports | 100% | 15% | 25% | 24% |
| ABF (Primark) | -31% | -7% | 7% | 15% |
*Past performance is not an indication of future results.
– ENDS –
Notes to editors
The basket of UK fashion stocks is constructed from the 10 largest UK headquartered fashion related stocks, by market capitalisation. It is a simple weighted index of stock price price performance. Data was taken on Friday 2nd June 2023.
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