Marks & Spencer (MKS) share price forecast ahead of earnings

By:
on May 17, 2024
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  • Marks & Spencer’s stock is nearing its highest level on record.
  • It will publish its interim financial results next week.
  • There are signs that its business is firing on all cylinders.

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Marks & Spencer’s (LON: MKS) share price will be in the spotlight next week as the company publishes its preliminary financial results. It has done well ahead of these results as it jumped to 276.9p, its highest swing since January 10th.

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Interim earnings ahead

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Marks & Spencer, the giant British retailer, will publish its interim result, providing more colour about its transformation. 

These results will show that UK retailers and the economy are doing well. A recent report revealed that the economy emerged from a recession in the first quarter. A separate figure showed that the country’s retail sales are booming.

Additionally, other retailers, especially Tesco, published strong financial results, which revealed that its annual revenue jumped by 7.4% to over £61.4 billion in the last financial year.  Its retail division’s adjusted operating profit rose to £2.7 billion. Tesco is often seen as a barometer for the UK’s retail sector.

Marks & Spencer published encouraging first-half financial results, which helped to propel its stock to a record high. Its profit before tax soared by 75% to £360 million, helped by its investments in food sales. It also restarted its dividend. 

The other catalyst for MKS is that its other business lines are doing well. Its clothing and home business is gaining momentum and market share in the UK and in its international markets.

The upcoming results will provide more colour about whether this trend continued in the second half of the year. Most notably, they will provide information about its joint venture with Ocado, that has not worked out as planned. To solve that, the company has boosted the SKUs sold by Ocado.

Analysts are generally optimistic about the MKS share price. Those at Barclays expect it to rise to 315p, a 15% increase from the current level. They expect its pre-tax profit will rise by 42% to £685 million. JP Morgan and Jefferies analysts are also bullish on the stock.

Marks & Spencer share price analysis

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marks & spencer

MKS chart by TradingView

The MKS stock price has been in a strong recovery ahead of the upcoming financial results. It has soared above the crucial resistance level at $269.5, its highest swing on April 12th.

The stock has remained above the ascending trendline that connects its lowest swings since October 2022. It has soared above the 50-day and 100-day Exponential Moving Averages (EMA).

The MACD has crossed the neutral point while the Awesome Oscillator has turned green. Therefore, the outlook for the stock is bullish, with the next point to watch being at 293.4p. A move above that level will point to more upside since it will invalidate the double-top pattern.

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