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Marks and Spencer (GB:MKS)
LSE:MKS
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Marks and Spencer (MKS) AI Stock Analysis

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GB:MKS

Marks and Spencer

(LSE:MKS)

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Neutral 61 (OpenAI - 4o)
Rating:61Neutral
Price Target:
353.00p
▲(5.47% Upside)
Marks and Spencer's overall stock score is driven by strong financial performance and positive corporate events. However, the high P/E ratio and bearish technical indicators weigh down the score. The earnings call provided a mixed outlook with growth in certain areas but challenges in others. The company's strategic initiatives and insider confidence are positive, but valuation concerns and technical weakness are significant risks.
Positive Factors
Revenue Growth
The significant increase in group sales, driven by Ocado Retail, indicates strong market position and potential for continued revenue growth.
Food Business Resilience
Consistent growth in the food segment highlights M&S's strong brand and product appeal, providing a stable revenue base.
Store Expansion and Modernization
The expansion and modernization of stores suggest a strategic focus on enhancing customer experience and increasing market reach.
Negative Factors
Impact of Cyber Incident
The cyber incident's significant financial impact underscores vulnerabilities in IT infrastructure, potentially affecting profitability.
Fashion, Home and Beauty Sales Decline
Declining sales in key segments indicate challenges in adapting to market changes, impacting overall revenue diversification.
International Sales Decline
The decline in international sales reflects operational challenges and limits growth potential in global markets.

Marks and Spencer (MKS) vs. iShares MSCI United Kingdom ETF (EWC)

Marks and Spencer Business Overview & Revenue Model

Company DescriptionMarks and Spencer Group plc operates various retail stores. It operates through five segments: UK Clothing & Home, UK Food, International, Ocado, and All Other. The company offers protein deli and dairy; produce; ambient and in-store bakery; meals dessert and frozen; and hospitality and Food on the Move' products. The company also provides womenswear, menswear, lingerie, kids wear, and home products; financial services, including credit cards, payment solutions, insurances, savings, and loans; and renewable energy services. In addition, it invests in and develops real estate properties; operates international franchises; and provides its products online. The company also exports its products. It operates 1,487 stores in worldwide. The company was founded in 1884 and is headquartered in London, the United Kingdom.
How the Company Makes MoneyMarks and Spencer generates revenue primarily through its retail operations, which include both physical stores and online sales. The Food segment is a significant revenue driver, contributing a large portion of the company's earnings through the sale of premium grocery items and ready-to-eat meals. The General Merchandise segment, which includes clothing and home products, also plays a crucial role in the company's profitability. MKS has developed a strong brand identity and customer loyalty, further enhancing its revenue potential. Key revenue streams include direct sales from stores and e-commerce platforms, while partnerships with suppliers and logistics companies help optimize operational efficiency and expand product offerings. Additionally, MKS has made strategic investments in sustainability and digital transformation, aiming to enhance customer experience and drive future growth.

Marks and Spencer Earnings Call Summary

Earnings Call Date:Nov 05, 2025
(Q2-2026)
|
% Change Since: |
Next Earnings Date:May 27, 2026
Earnings Call Sentiment Neutral
The call highlighted significant growth in sales driven by the inclusion of Ocado Retail and resilience in the food sector, alongside strategic investments in store and technology. However, challenges remain with the impact of a cyber incident, declines in Fashion, Home and Beauty, and international sales, and an uncertain consumer environment.
Q2-2026 Updates
Positive Updates
Group Sales Growth
Group sales grew 22% versus last year, mainly driven by the consolidation of Ocado Retail. M&S Food sales grew 7.8% in the half.
Food Business Resilience
M&S Food achieved 3 years of consecutive monthly volume growth, outperforming the market. Sales of value ranges are up 29%.
Store Expansion and Modernization
Opened 15 new or renewed stores in the first half and plan to open more than 20 in the second half. New food distribution center announced for 2029.
Technology and Supply Chain Investments
Investments in technology and supply chain modernization, including a new Fashion, Home and Beauty planning platform and a new automated food distribution center.
Negative Updates
Impact of Cyber Incident
The material impact of the cyber incident on group operating profit is estimated at GBP 300 million for the financial year.
Fashion, Home and Beauty Sales Decline
Sales in Fashion, Home and Beauty were down 16.4%, affected by paused online operations and supply chain disruptions.
International Sales Decline
International sales were down 11.6% due to offline international websites and shipment disruptions.
Consumer Environment Uncertainty
The consumer environment remains uncertain, with concerns about cost pressures such as national insurance contributions and packaging tax.
Company Guidance
In the recent Marks and Spencer analyst call, the company provided guidance on several key metrics for its fiscal year 2026. Group sales grew by 22%, primarily due to the consolidation of Ocado Retail, while M&S sales remained flat compared to the previous year. The group reported a profit before tax and adjusting items of GBP 184 million and maintained a net funds position excluding lease liabilities. The call highlighted a material impact on group operating profit by around GBP 300 million due to a significant incident, partially mitigated by a GBP 100 million insurance claim. In terms of individual business segments, food sales grew by 7.8%, while fashion, home, and beauty sales declined by 16.4% due to online operation pauses, supply chain disruptions, and reduced footfall. The company also emphasized their transformation strategy, including investments in store rotation, supply chain modernization, and technology, with plans to open more than 20 new or renewed stores in the second half. Additionally, international sales were down by 11.6%, with recovery efforts underway, and Ocado Retail saw a 14.9% sales increase. The outlook for the second half anticipates profit at least in line with the previous year, with a focus on cost reduction to offset external headwinds, including GBP 50 million from national insurance contributions and packaging tax.

Marks and Spencer Financial Statement Overview

Summary
Marks and Spencer shows strong revenue growth and efficient cost management, though profitability is pressured by lower net profit margins. The balance sheet is stable with balanced leverage, and the company maintains healthy cash flow metrics. While operational efficiency is moderate, the strong cash flows and revenue trajectory provide a solid foundation for future growth.
Income Statement
78
Positive
Marks and Spencer has shown consistent revenue growth over the past years, with a notable revenue increase from 2024 to 2025. The Gross Profit Margin is strong at 33.4% for 2025, indicating effective cost management. However, the Net Profit Margin has decreased to 2.1% in 2025, signaling pressure on profitability. The EBIT margin of 4.5% reflects moderate operational efficiency, while the EBITDA margin of 10.8% in 2025 shows a solid core earnings capacity.
Balance Sheet
72
Positive
The company's balance sheet shows a moderate Debt-to-Equity Ratio of 1.0, indicating balanced leverage. The Return on Equity (ROE) is 10.1% for 2025, demonstrating decent profitability relative to equity. The Equity Ratio is 33.3%, reflecting a stable capital structure, though there's room for improvement in strengthening equity further.
Cash Flow
80
Positive
Cash flow analysis reveals robust Free Cash Flow growth, as seen in the positive Free Cash Flow to Net Income Ratio of 2.7 in 2025. The Operating Cash Flow to Net Income Ratio is 4.4 in 2025, indicating strong cash generation relative to net income. Overall, the company demonstrates healthy cash flow management.
BreakdownTTMDec 2025Dec 2024Dec 2023Dec 2022Dec 2021
Income Statement
Total Revenue13.82B13.82B13.04B11.93B10.89B9.16B
Gross Profit13.82B4.61B4.46B4.14B3.75B2.91B
EBITDA1.36B1.49B1.37B1.20B1.16B622.90M
Net Income295.70M295.70M431.20M363.40M306.60M-198.00M
Balance Sheet
Total Assets8.82B8.82B8.68B9.10B9.44B8.64B
Cash, Cash Equivalents and Short-Term Investments1.15B1.15B1.03B1.08B1.22B692.80M
Total Debt2.94B2.94B3.13B3.63B3.81B4.09B
Total Liabilities5.87B5.87B5.85B6.28B6.53B6.35B
Stockholders Equity2.94B2.94B2.83B2.81B2.91B2.28B
Cash Flow
Free Cash Flow904.60M806.10M872.40M619.60M1.12B664.20M
Operating Cash Flow1.31B1.31B1.30B1.03B1.38B870.90M
Investing Cash Flow-696.10M-696.10M-435.30M-516.60M-245.70M-192.60M
Financing Cash Flow-773.60M-773.60M-909.80M-643.80M-595.90M-244.00M

Marks and Spencer Technical Analysis

Technical Analysis Sentiment
Negative
Last Price334.70
Price Trends
50DMA
371.26
Negative
100DMA
358.98
Negative
200DMA
358.63
Negative
Market Momentum
MACD
-10.21
Negative
RSI
37.68
Neutral
STOCH
44.44
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:MKS, the sentiment is Negative. The current price of 334.7 is below the 20-day moving average (MA) of 345.32, below the 50-day MA of 371.26, and below the 200-day MA of 358.63, indicating a bearish trend. The MACD of -10.21 indicates Negative momentum. The RSI at 37.68 is Neutral, neither overbought nor oversold. The STOCH value of 44.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:MKS.

Marks and Spencer Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
£16.49B21.1451.86%1.74%9.74%0.92%
70
Outperform
£1.72B5.3934.27%16.91%1.74%-23.72%
63
Neutral
£2.02B-207.50-0.31%-0.57%-104.08%
61
Neutral
$18.38B12.79-2.54%3.03%1.52%-15.83%
61
Neutral
£6.75B341.530.68%1.14%14.13%-96.12%
55
Neutral
£4.20B-55.67-3.00%-9.44%-170.53%
46
Neutral
£274.50M-0.93-81.34%-14.89%12.08%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:MKS
Marks and Spencer
334.70
-51.98
-13.44%
GB:ASC
ASOS plc
258.00
-123.00
-32.28%
GB:BME
B&M European Value Retail SA
166.75
-160.26
-49.01%
GB:VTY
Vistry Group
640.80
-69.20
-9.75%
GB:BRBY
Burberry
1,230.50
260.50
26.86%
GB:NXT
Next plc
14,075.00
4,466.94
46.49%

Marks and Spencer Corporate Events

Other
Marks and Spencer Director Purchases Company Shares
Positive
Dec 3, 2025

Marks and Spencer Group PLC announced a transaction involving the purchase of its ordinary shares by Sean Doyle, a Non-Executive Director. This transaction, conducted on the London Stock Exchange, involved the purchase of 2,526 shares at a price of £3.3430 each, reflecting insider confidence and potentially impacting investor perceptions positively.

Business Operations and Strategy
Marks and Spencer Announces Share Options for Directors
Positive
Dec 3, 2025

Marks and Spencer Group plc has announced the granting of options to purchase ordinary shares to two of its directors under the company’s Sharesave scheme. This initiative, which allows employees to save and purchase shares at a predetermined price, reflects the company’s commitment to employee investment and engagement, potentially enhancing stakeholder value and aligning managerial interests with shareholder interests.

Other
Marks and Spencer Announces Director Share Sale
Neutral
Dec 1, 2025

Marks and Spencer Group plc announced a transaction involving the sale of 36,034 ordinary shares by A Freudmann, the Managing Director of Food, at a price of £3.45801 per share. This transaction, conducted on December 1, 2025, at the London Stock Exchange, reflects internal shareholding changes and could have implications for the company’s stock market performance and stakeholder interests.

Regulatory Filings and Compliance
Marks and Spencer Announces Share Capital Structure
Neutral
Dec 1, 2025

Marks and Spencer Group PLC announced that its capital consists of 2,057,125,306 ordinary shares with voting rights, and it currently holds no shares in Treasury. This information is essential for shareholders to calculate their interests in the company as per the FCA’s Disclosure and Transparency Rules, impacting how they manage their investments and comply with regulatory requirements.

Business Operations and Strategy
Marks and Spencer Directors Acquire Shares Through Incentive Plan
Positive
Nov 28, 2025

Marks and Spencer Group plc announced that key directors and persons discharging managerial responsibility have acquired additional shares through the company’s Share Incentive Plan. This transaction reflects the company’s ongoing commitment to aligning the interests of its leadership with those of its shareholders, potentially strengthening stakeholder confidence and enhancing market positioning.

Executive/Board ChangesBusiness Operations and Strategy
Marks and Spencer Announces Board Change as Ronan Dunne Steps Down
Neutral
Nov 17, 2025

Marks and Spencer Group PLC announced the departure of Ronan Dunne from its Board, effective December 1. Dunne, who has been a Non-Executive Director since August 2022, is leaving to focus on early-stage businesses, aligning with his passion for supporting growth ventures. His departure comes as M&S continues its ‘Reshaping for Growth’ strategy, with recent appointments of Roger Burnley and Sean Doyle as non-executive directors, signaling a strategic shift in leadership to bolster the company’s growth and transformation efforts.

Business Operations and Strategy
Marks and Spencer Announces Director Share Sale
Neutral
Nov 12, 2025

Marks and Spencer Group plc announced a transaction involving the sale of 193,819 ordinary shares by S Berendji, the Operations Director, at a price of £3.6930 per share. This transaction, conducted on the London Stock Exchange, highlights the company’s ongoing financial activities and could have implications for its market positioning and stakeholder interests.

Executive/Board ChangesBusiness Operations and Strategy
Marks and Spencer Strengthens Board with New Appointments
Positive
Nov 12, 2025

Marks and Spencer Group PLC has announced the appointment of Sean Doyle, the Chairman & CEO of British Airways, as a Non-Executive Director on its Board starting December 1, 2025. This move is part of M&S’s broader strategy to refresh its Board as it embarks on the next phase of its ‘Reshaping for Growth’ strategy. The appointment of Doyle, alongside Roger Burnley, former CEO of Asda, and the extension of Archie Norman’s tenure as Chair, aims to leverage Doyle’s leadership and operational expertise to strengthen M&S’s market position and support its modernization efforts.

DividendsFinancial Disclosures
Marks and Spencer Announces Interim Results and Dividend
Positive
Nov 5, 2025

Marks and Spencer Group PLC announced its interim results for the 26 weeks ended 27 September 2025, declaring an interim dividend of 1.2p per share payable on 9 January 2026. The announcement reflects the company’s ongoing commitment to shareholder returns and provides insights into its financial health and strategic direction, potentially impacting investor confidence and market positioning.

Regulatory Filings and Compliance
Marks and Spencer Announces Share Capital and Voting Rights Update
Neutral
Nov 3, 2025

Marks and Spencer Group PLC announced that its capital consists of 2,057,101,623 ordinary shares with voting rights, with no shares held in Treasury. This information is crucial for shareholders to determine their notification requirements under the FCA’s Disclosure and Transparency Rules, impacting how they manage their interests in the company.

Executive/Board ChangesBusiness Operations and Strategy
Marks and Spencer Appoints Roger Burnley as Non-Executive Director
Positive
Oct 30, 2025

Marks and Spencer Group PLC has announced the appointment of Roger Burnley CBE as a Non-Executive Director, effective from December 1, 2025. With his extensive experience in the food retail industry and supply chain transformation, Burnley’s addition is seen as a strategic move to support M&S’s ongoing ‘Reshaping for Growth’ strategy. His role on the Board and its committees is expected to help the company capitalize on growth opportunities, enhancing its market position and operational effectiveness.

Business Operations and Strategy
Marks and Spencer Directors Increase Shareholdings
Positive
Oct 28, 2025

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 move, involving key figures such as Operations Director S Berendji and Managing Director of Food A Freudmann, reflects a commitment to align the interests of management with those of shareholders, potentially impacting the company’s market positioning and stakeholder confidence positively.

Executive/Board ChangesBusiness Operations and Strategy
Marks and Spencer Extends Chairman’s Tenure to Drive Growth Strategy
Positive
Oct 14, 2025

Marks and Spencer Group PLC has announced the extension of Archie Norman’s tenure as Chairman to support the next phase of its ‘Reshaping for Growth’ strategy. This decision, supported by shareholders and the board, aims to provide stability and strong leadership as the company continues its transformation. The extension will last for three years from September 2026, subject to annual reviews, and will be presented for shareholder approval at the AGM.

Business Operations and Strategy
Marks and Spencer Directors Increase Shareholdings
Positive
Sep 30, 2025

Marks and Spencer Group PLC announced that directors and persons discharging managerial responsibilities have acquired additional shares through the company’s all-employee Share Incentive Plan. This transaction, involving Operations Director S Berendji and Managing Director of Food A Freudmann, reflects ongoing confidence in the company’s performance and future prospects, potentially strengthening stakeholder trust and aligning management interests with shareholder value.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Dec 07, 2025