Marks and Spencer (MKS) AI Stock Analysis

• Market Cap: £7.60B
• Dividend Yield: 0.82%
• Average Volume (3M): 10.29M
• Price to Earnings (P/E): 14.9
• Beta (1Y): 0.86
• Revenue Growth: 6.87%
• EPS Growth: 22.36%
• Country: UK
• Employees: 65,848
• Sector: Consumer Cyclical
• Sector Strength: 53
• Industry: Retail - Discretionary
• EPS (TTM): 0.25
• Shares Outstanding: 2,054,375,700
• 10 Day Avg. Volume: 7,631,664
• 30 Day Avg. Volume: 10,291,459
• PEG Ratio: 0.67
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.56
• Price to Cash Flow (P/CF): 9.50
• P/FCF Ratio: 41.80
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: 423.00p
• Price Target Upside: 12.32% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

Marks and Spencer's stock is rated at 70, supported by solid financial performance and positive corporate actions. However, the fair valuation and neutral technical indicators suggest limited short-term price momentum. The company's strong cash flow and strategic investments potential are key strengths, while profitability and dividend yield remain areas for improvement.

Marks and Spencer Business Overview & Revenue Model

Company Description

Marks and Spencer (MKS) is a renowned British multinational retailer headquartered in London, United Kingdom. Established in 1884, the company operates in the retail sector, specializing in the sale of clothing, home products, and food items. M&S is known for its high-quality, stylish apparel and luxury food offerings, catering to a broad customer base through its extensive network of stores and online platforms.

How the Company Makes Money

Marks and Spencer generates revenue through a diversified model focusing primarily on retail sales of clothing, home goods, and food products. The company operates a wide network of physical stores in the UK and internationally, while also leveraging its e-commerce platform to reach online shoppers. Clothing and home products are significant contributors to its revenue, with M&S offering a range of fashion and household items that appeal to various consumer demographics. The food segment is another key revenue stream, with M&S Food known for its premium quality and innovative product range. Additionally, strategic partnerships and collaborations with other brands and designers help M&S enhance its product offerings and drive sales. The company's revenue is further supported by its focus on enhancing customer experience, operational efficiency, and sustainable business practices.

Marks and Spencer Financial Statement Overview

Summary

Marks and Spencer demonstrates a solid financial performance with strong revenue and cash flow growth. While profitability metrics are improving, there is room for enhancing operational efficiency further. The balance sheet remains reasonably strong with controlled leverage. The company is well-positioned to capitalize on its cash flow strength for strategic investments or debt reduction.

Income Statement

Marks and Spencer's income statement reflects strong revenue growth, with a 9.3% increase from 2023 to 2024. The gross profit margin improved to 34.2%, indicating efficient cost management. Net profit margin increased to 3.3%, though still moderate, showing improved profitability. The EBITDA margin also rose to 10.9%, highlighting better operational efficiency. However, the EBIT margin is still at a modest 6.1%, suggesting potential areas for operational improvement.

Balance Sheet

The balance sheet shows a manageable debt-to-equity ratio of 1.11, reflecting a stable financial structure. Return on equity (ROE) improved to 15.2%, indicating effective use of equity to generate profits. The equity ratio is 32.6%, signifying decent equity financing, but there is room for strengthening equity further to reduce financial risk.

Cash Flow

The cash flow statement is strong, with a significant 102.3% growth in free cash flow from 2023 to 2024, indicating robust cash generation. The operating cash flow to net income ratio is 3.02, suggesting healthy cash flow relative to earnings. Free cash flow to net income ratio is also strong at 2.02, demonstrating good cash management and potential for reinvestment or debt reduction.

Breakdown
TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
13.39B	13.04B	11.93B	10.89B	9.14B	10.18B
	Gross Profit
4.55B	4.46B	3.57B	3.22B	2.39B	2.92B
	EBIT
870.40M	794.10M	533.50M	666.20M	303.50M	588.60M
	EBITDA
1.22B	1.42B	1.29B	1.20B	559.10M	986.60M
	Net Income Common Stockholders
505.30M	431.20M	363.40M	306.60M	-198.00M	23.70M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.03B	1.03B	1.08B	1.22B	692.80M	265.90M
	Total Assets
8.68B	8.68B	9.10B	9.44B	8.64B	10.19B
	Total Debt
3.13B	3.13B	3.59B	3.76B	4.05B	4.08B
	Net Debt
2.11B	2.11B	2.52B	2.55B	3.36B	3.82B
	Total Liabilities
5.85B	5.85B	6.28B	6.53B	6.35B	6.48B
	Stockholders Equity
2.83B	2.83B	2.81B	2.91B	2.28B	3.70B
Cash Flow		Free Cash Flow
798.60M	872.40M	431.20M	912.40M	454.10M	411.40M
	Operating Cash Flow
1.16B	1.30B	841.50M	1.17B	660.80M	740.00M
	Investing Cash Flow
-586.90M	-435.30M	-540.70M	-254.10M	-201.80M	-776.10M
	Financing Cash Flow
-782.20M	-909.80M	-431.30M	-379.30M	-24.70M	-32.70M

Marks and Spencer Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 376.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:MKS, the sentiment is Positive. The current price of 376.6 is above the 20-day moving average (MA) of 354.44, above the 50-day MA of 352.25, and above the 200-day MA of 346.61, indicating a bullish trend. The MACD of 4.96 indicates Negative momentum. The RSI at 68.68 is Neutral, neither overbought nor oversold. The STOCH value of 91.29 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:MKS.

Marks and Spencer Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JD	77 Outperform	£3.97B	12.33	21.94%	1.21%	2.85%	61.98%
TSCO	73 Outperform	£26.03B	23.11	10.18%	3.31%	―	―
MKS	70 Outperform	£7.60B	14.90	15.23%	0.82%	6.87%	22.36%
FRAS	68 Neutral	£2.57B	8.76	20.64%	―	-6.82%	-37.46%
SBRY	64 Neutral	£5.77B	42.23	1.99%	5.17%	2.66%	80.49%
BWY	64 Neutral	£2.68B	20.58	3.77%	2.32%	-30.13%	-63.13%
Sector *	60 Neutral	$13.01B	10.45	0.79%	3.53%	1.60%	-22.47%

Marks and Spencer Corporate Events

Marks and Spencer Announces Current Share Capital and Voting Rights

Marks and Spencer Group PLC has announced that its capital consists of 2,054,375,759 ordinary shares with voting rights, and it currently holds no shares in Treasury. This information is crucial for shareholders to determine their interest in the company according to the FCA’s Disclosure and Transparency Rules, impacting how they notify changes in their shareholding.

Marks and Spencer Directors Acquire Additional Shares

Marks and Spencer Group PLC announced that directors and persons discharging managerial responsibilities have acquired additional shares in the company through its all-employee Share Incentive Plan. This acquisition, involving Operations Director S Berendji and Managing Director of Food A Freudmann, reflects continued confidence in the company’s performance and aligns with regulatory requirements under the UK Market Abuse Regulation.

Marks and Spencer Discloses Share Capital and Voting Rights

Marks and Spencer Group PLC has announced that its capital comprises 2,051,666,377 ordinary shares with voting rights, and currently, the company does not hold any shares in Treasury. This disclosure is crucial for shareholders as it provides the necessary denominator for calculating shareholding interests under the FCA’s Disclosure and Transparency Rules, impacting how investors manage and report their ownership stakes.

Marks and Spencer Directors Increase Shareholdings through Incentive Plan

Marks and Spencer Group plc announced that key directors and persons discharging managerial responsibility have acquired additional shares through the company’s all-employee Share Incentive Plan. This move, involving the acquisition of ordinary shares by Operations Director S Berendji and Managing Director of Food A Freudmann, reflects the company’s commitment to aligning employee interests with shareholder value, potentially impacting the company’s operational focus and market confidence.

Marks and Spencer Directors Increase Shareholdings Through DRIP

Marks and Spencer Group plc announced that certain directors and persons discharging managerial responsibility acquired additional shares in the company through its Dividend Reinvestment Plan (DRIP). This transaction, which took place on January 10, 2025, involved the purchase of ordinary 1p shares at prices ranging from £3.38 to £3.434641, underscoring the management’s ongoing commitment to investing in the company’s future. The acquisition reflects confidence in the company’s strategic direction and potential growth prospects, potentially reassuring stakeholders about the company’s stability and future performance.

Marks and Spencer Reports Strong Christmas Sales Amid Economic Challenges

Marks and Spencer reported strong Christmas trading results, with total UK and ROI sales up 5.9% and international sales down 2.8%. Food sales grew by 8.7%, driven by quality and innovation, making M&S the top-performing store-based grocery retailer in volume and value. Clothing, Home & Beauty saw a modest 1.0% sales increase, with online sales notably up by 11.7%. The company remains committed to modernizing its supply chain and enhancing its digital capabilities, despite facing economic headwinds.

Marks and Spencer Updates Shareholder Voting Rights Information

Marks and Spencer Group PLC has announced that its capital consists of 2,051,512,647 ordinary shares with voting rights, with no shares held in Treasury. This information is crucial for shareholders as it serves as a denominator for calculating their interests under the FCA’s Disclosure and Transparency Rules, highlighting the company’s commitment to regulatory compliance and transparency.

Marks and Spencer Directors Acquire Shares Under Incentive Plan

Marks and Spencer Group plc announced recent transactions involving their Ordinary 1p shares by directors and persons discharging managerial responsibilities, under the company’s Share Incentive Plan. On December 27, 2024, directors S Berendji and A Freudmann each acquired 39 shares at a price of £3.81444, as part of an initiative to encourage employee participation in the company’s financial growth. These transactions are in line with Article 19 of the UK Market Abuse Regulation and were conducted on the London Stock Exchange.

Marks and Spencer Directors Gain Share Options

Marks and Spencer Group has announced that key figures within the company have been granted options to purchase shares under its Sharesave scheme. This initiative, which allows employees to save monthly and buy shares at a predetermined price, could potentially boost employee investment and confidence in the company’s future. The options were granted to directors S Berendji and A Freudmann, reflecting their significant roles within the organization.