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Why has the Frasers Group share price rocketed 13% today?

first_img Royston Wild | Thursday, 10th December, 2020 | More on: FRAS I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Our 6 ‘Best Buys Now’ Shares Investors have witnessed a stunning turnaround in the Frasers Group (LSE: FRAS) share price recently. The UK share — which was known as Sports Direct International until it snapped up House of Fraser a year ago — has steadily recovered ground following the early 2020 stock market crash. A sprint higher in Thursday business means it’s now up by double-digits since the start of the year.The Frasers Group share price was up 13% at the time of writing, close to 500p too. It’s shot higher on strong half-year results which prompted the retailer to raise its guidance for the full fiscal year.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Frasers Group enjoys profit surgeThe Covid-19 pandemic has, of course, delivered a hammerblow to a British retail sector already under huge pressure. Frasers Group has been no stranger to these troubles and revenues dropped 7.4% during the six months to 25 October, to £1.89bn.Indeed, sales at the group’s core UK Sports Retail division slumped 9.8% during the half year, or 12.4% excluding acquisitions. The lion’s share of turnover here is sourced from the company’s Sports Direct unit and therefore sales slumped due to mass store closures.Still, investors have sent Fraser Group’s share price soaring on news of exceptional profit growth during that time. Before taxes, the FTSE 250 share saw earnings rocket 17.6% in the half year to October, to £106.1m. Underlying EBITDA, meanwhile, shot 24.9% higher to £226.3m.Store sales rocket as lockdowns liftedFrasers Group said that “the strong reopening of stores after lockdown [and] growth in our online business” helped drive profits in the first half. The contribution of its new Flannels designer fashion stores, profits from acquisitions made in the prior fiscal year, and ongoing cost-cutting, also helped push the bottom line higher from the same 2019 period, the UK share said.As I say, Frasers Group lifted its profits expectations for the full year on the back of that robust first half. The retailer now expects underlying EBITDA to rise between 20% and 30% in the 12 months to April 2021.This is up from the 10-30% earnings improvement the firm had forecasted back in August.Reasons to be cheerfulFrasers Group has undoubtedly benefitted significantly from the rise of the athleisure fashion segment in 2020. It’s a sub-sector which analysts reckon will go from strength to strength in the years ahead too.The retailer’s strong online performance also bodes well for future profits. Incidentally, Frasers Group recently announced a huge £100m investment programme to bolster its digital business and capitalise on the booming e-commerce market to its fullest.City analysts reckon Frasers Group’s earnings will soar 25% in the current financial year. And they reckon they’ll soar 21% in fiscal 2022 too. Such estimates could receive a shot in the arm following Thursday’s solid results. Today, Frasers Group trades on a forward price-to-earnings growth (PEG) ratio of 0.9. Why has the Frasers Group share price rocketed 13% today? See all posts by Royston Wild Enter Your Email Address Simply click below to discover how you can take advantage of this.center_img Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. 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