Marks and Spencer share price: Retailer loses market share

on Mar 20, 2014
Updated: Apr 9, 2020
Listen, Thursday, March 20: Retailer Marks and Spencer (LON:MKS) has suffered a further market share setback in the crucial clothing category, the Financial Times reported yesterday.

According to Kantar Worldpanel data, seen by the newspaper, Marks and Spencer’s total fashion market share slipped by 0.4 percentage points in the 12 weeks to February 16. That was an acceleration of the 0.2 point fall in the 24 weeks to the same date. The group’s womenswear share was down 0.5 points over 12 weeks and 0.2 points over 24 weeks, the market researcher found, while share losses also accelerated in menswear.

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The indicated decline in total fashion share is in contrast to strong gains at rival Next (LON:NXT) – which today posted full-year profit surpassing that of Marks and Spencer (Next share price rises as annual earnings meet top end of guidance) and flat share at Debenhams (LON:DEB), the FT noted, without disclosing the rivals’ figures.

**Brokers react to news**
The leaked industry data has triggered M&S’s joint broker Citi, as well as Nomura, to forecast a fall rather than a rise in underlying clothing sales over the retailer’s final quarter.
Citi moved from forecasting a one percent increase in general merchandise sales in M&S’s final quarter to a one percent decline, while Nomura forecast a 1.5 percent fall. They continue to expect flat to slightly higher like-for-like food sales at the retailer.

The sales decline also prompted the brokers to downgrade their profit forecasts for M&S. Citi cut its full-year profit forecast from £630 million to £615 million and Nomura moved from £632 million to £614 million.
Marks and Spencer is expected to report Q4 results on April 10 and final results on May 20. The downgrades will be a blow to CEO Marc Bolland who is under pressure to turn around clothing sales after 10 consecutive quarters of decline.

When contacted by the FT, M&S declined to comment on its market share or on the broker downgrades.
**Marks and Spencer share price**
The mounting concerns about trade at M&S have weighed on the company’s stock today. As of 08:20 UTC, Marks and Spencer’s share price was 1.50 percent lower at 465.50p.
According to AnalystRatingsNetwork data, five research analysts have a ‘sell’ rating on the retailer, seven have it as a ‘hold’ and 17 rate it as a ‘buy’. The consensus rating is ‘hold’ with an average price target of 496.61p.
**As of 13:17 UTC, buy Marks and Spencer shares at 465.60p.**
**As of 13:17 UTC, sell Marks and Spencer shares at 465.50p.**


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