The previous day's drop was "as if somebody thought that Black Friday had not gone well" for the online fashion group, noted independent retail analyst Nick Bubb.
AIM's largest company responded with an unscheduled trading update that it had enjoyed “record” sales across the Black Friday weekend and that its new ranges for Karen Millen and Coast have been “very well received”.
The newly acquired pair of brands represent a potentially risky move away from Boohoo's focus on teenagers into a more mature and potentially more lucrative portion of the market.
After enjoying a warm reception for its first designs for Karen Millen, Coast and MissPap, Boohoo said it was continuing to broaden the product ranges and get the new brands' customers more used to buying online.
Trading since the second half began in September was said to have been “comfortably” on trend with analysts’ full-year financial expectations.
Following a first half where revenues soared 43%, the operator of the PrettyLittleThing and Nasty Gal labels said trading has “remained strong across its key brands”, though no numbers were provided in the short update, with a fuller missive due post the crucial festive period on 14 January.
Boohoo elaborated that both its warehouses, an automated facility that the company operates in Burnley and a third-party operated facility in Sheffield, had a “strong operational performance”, with the new brands “successfully integrated”.
Shares in Boohoo rose 3% to 307.5p on Tuesday morning, recovering some of the sharp losses from the day before.
Broker Shore Capital said: "In our view, the Boohoo group has momentum and continues to leverage its multi-brand platform. With seven brands in the portfolio the company is starting to resemble Inditex (owner of Zara) with a stable of eight high street brands.
"Boohoo group remains a key disruptor in UK clothing and this is another good trading update which will reassure investors that the momentum continues."
Analysts at Liberum said: "While there is no change to guidance today, the update is clearly very positive... from both a trading perspective and in terms of operational execution".
They said the update reinforces their positive view on the stock: "The group's performance and momentum is very impressive when set against the market backdrop and its peers. Its cash generative, self-reinforcing model allows for reinvestment back into the business to sustain c.40% top line growth, while still achieving a c.10% EBITDA margin."