Marks & Spencer "Reinvigorating the growth narrative, Buy" (Buy) Rajani

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Marks & Spencer "Reinvigorating the growth narrative, Buy" (Buy) Rajani

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Marks & Spencer Equities

United KingdomReinvigorating the growth narrative, Buy

Retailers, Broadline

12-month rating Buy

Prudent outlook in the face of strong execution; Remain Buy

MKS FY'26 results have fully put even the aftermath of Cyber behind us as evidenced by 12m price target 425p

Q4 FHB LFLs being strong at +4.3% with availability 'better vs last year' in the last two

weeks. With a clean FY27e ahead of us, the focus is likely to be on MKS's strong

Price (20 May 2026) 349p

momentum and structural gains - reinvigorating the growth narrative after being the

best turnaround in UK Retail. We think there's a lot to like here given: a) FHB 'beating RIC: MKS.L BBG: MKS LN

budgets pretty significantly' when in the period of 'hot weather' suggesting that the

Trading data and key metrics

fashion is resonating with customers which gives confidence on Q1/Q2 momentum; b)

52-wk range 408p-309

H2 margins for Food being the best ever at 6.9% despite MKS efforts to protect the

value proposition. This with strong Q4 LFL and the new store openings suggest that MKS Market cap. £7.11b/US$9.56b

can potentially continue to protect its sector leading margins in Food even in an Shares o/s 2,041m (ORD)

inflationary environment; c) Confidence on healthy cash flow generation despite the Free float 100%

front loaded capex in FY27e suggest that the debate on better shareholder returns may Avg. daily volume ('000) 8,331

resurface as we head into H2'27e. In the face of all these positives, we see MKS' MSD% Avg. daily value (m) £29.1

underlying PBT growth outlook implying £920m-£940m as quite prudent (UBSe £945m) Common s/h equity (03/27E) £3.92b