This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Trade Parameters
Observations – For
Observations – Against
Deutsche bank’s downgrade and Bernstein’s reiteration of underperform just before the retailer’s trading statement suggests the brokers don’t expect trends to have improved much since the latest update in early Nov when Next cut sales guidance and after which the shares traded flat. The weak GBP will only become more of a hindrance for costs and margins. We still await news on Article 50 and soft or hard Brexit. Beware a strong Christmas holiday period.
Consensus has more sellers than buyers and a significant number of undecided who could turn negative amid any strong share price sell-off. The consensus target implies limited upside of just 3.5%, not even as far as 5000p, while the first broker updates of 2017 see the shares reiterated at underperform (5% downside) by Bernstein and downgraded to Hold by Deutsche Bank. The most bearish of targets (4580p/-5%) versus the most optimistic of 6632p (+38) means brokers may be too optimistic.
Next Event: Trading Statement, 4 Jan; Prelim FY Results, 23 Mar
Latest Broker 12-Month Consensus: 15% Buy, 59% Hold, 26% Sell (full breakdown on request)
Source: DowJones Newswires, Reuters News, Bloomberg or Company Press releases
| Share | 1wk | 1m | 3m | 6m | 1yr | 2yr | 3yr | 4yr | 5yr |
| Perf % | -2.1 | -1.8 | 0.9 | -2.3 | -33.8 | -28.4 | -11.7 | 29.9 | 76.0 |
This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.
Accendo Markets considers opinions and information contained within the research to be valid when published, and gives no warranty as to the investments referred to in this material. The income from the investments referred to may go down as well as up, and investors may realise losses on investments. The past performance of a particular investment is not necessarily a guide to its future performance. Prepared by Michael van Dulken, Head of Research