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Best of the Best (BOTB) Shares Plunged 33.7% Amid Falling Customer Interest

Simon Mugo trader
Updated 16 Jun 2021

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Best of the Best (BOTB) logo

Shares of Best of the Best plc (LON: BOTB) plummeted 33.7% after the company, which organises dream car competitions, warned of declining customer interest as the UK heads towards a full reopening.

The company noted that interest from potential customers had declined following the easing of lockdown restrictions in the UK. As a result, many people are probably focused on other activities instead of participating in competitions to win their dream cars.

Regardless, the company reported a 156.77% jump in 2020 revenues to £45.68 million from the £17.79 million recorded in 2019, with its profits up 235.56% from £4.19 million to £14.06 million.

Best of the Best closed its airport competitions business in 2019, which in hindsight was a great decision given the negative impact of the coronavirus pandemic on businesses that rely on airport traffic.

The company transitioned into a fully digital business, which did exceptionally well in 2020, driven partly by the lockdown restrictions that forced many people to stay at home. However, its business has slowed down after the recent easing of restrictions in the UK as more people spend time away from their homes.

Today’s selloff in BOTB shares appears like an overreaction, given that nothing much has changed about the business. Moreover, the waning interest from consumers can be fixed via aggressive marketing campaigns to attract new customers.

BOTB is flush with cash given that it upped its full-year dividend to 5p and paid a special dividend of 50p as part of efforts to return cash to shareholders. As a result, despite today’s selloff, BOTB shares are still up 32.27% in 2021.

Nobody knows whether the recent change in consumer preferences will last and have a long-term effect on BOTB’s business; only time will tell.

BOTB share price.

IG chart of Best of the Best (BOTB) share price 16-06-2021

Best of the Best shares fell 33.65% to trade at 1745p, falling from Tuesday’s closing price of 2630p.

Should you invest in Best of the Best shares?

Best of the Best shares are traded on the London stock exchange's AIM market (the alternative investment market), which is the submarket specifically for smaller companies. AIM stocks are attractive to investors as they have tax advantages and smaller companies have the potential to benefit from rapid growth. But are Best of the Best shares the best buy? Our stock market analysts regularly review the market and share their picks for high growth companies

Simon has over six years of professional trading experience across FX, commodities and equities. He has a strong passion for financial markets and is particularly focused on price action trading