Marks and Spencer (MKS) AI Stock Analysis

• Market Cap: £7.81B
• Dividend Yield: 0.78%
• Average Volume (3M): 7.10M
• Price to Earnings (P/E): 15.3
• Beta (1Y): 0.46
• Revenue Growth: 6.87%
• EPS Growth: 22.36%
• Country: UK
• Employees: 64,000
• Sector: Consumer Cyclical
• Sector Strength: 63
• Industry: Department Stores
• EPS (TTM): 0.25
• Shares Outstanding: 2,055,200,200
• 10 Day Avg. Volume: 6,666,557
• 30 Day Avg. Volume: 7,099,978
• PEG Ratio: 0.68
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.51
• Price to Cash Flow (P/CF): 8.70
• P/FCF Ratio: 38.30
• 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: £422.43
• Price Target Upside: 9.44% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

Marks and Spencer's stock is supported by a solid financial performance with strong revenue and cash flow growth. Technical analysis indicates stable momentum, while valuation metrics suggest fair pricing relative to peers. Corporate events, such as director share acquisitions, reflect confidence in the company's future, although the recent cyber incident poses a short-term risk. Overall, the stock presents a balanced risk-reward profile.

Marks and Spencer Business Overview & Revenue Model

Company Description

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

Marks and Spencer Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 386.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 386 is above the 20-day moving average (MA) of 377.68, above the 50-day MA of 360.54, and above the 200-day MA of 358.05, indicating a bullish trend. The MACD of 12.92 indicates Negative momentum. The RSI at 56.29 is Neutral, neither overbought nor oversold. The STOCH value of 57.37 is Neutral, 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
TSCO	78 Outperform	£22.52B	14.14	10.18%	3.49%	―	―
JD	77 Outperform	£4.01B	12.57	14.67%	1.20%	2.85%	61.98%
SBRY	73 Outperform	£6.00B	17.49	6.21%	5.04%	0.34%	150.85%
FRAS	72 Outperform	£2.72B	9.27	16.46%	―	-6.82%	-37.46%
MKS	70 Outperform	£7.81B	15.30	17.19%	0.78%	6.87%	22.36%
BWY	64 Neutral	£3.04B	20.69	4.22%	2.11%	-11.63%	-31.81%
Sector *	60 Neutral	$6.86B	11.61	3.16%	4.15%	2.41%	-21.45%

Marks and Spencer Corporate Events

Marks and Spencer Temporarily Halts Online Orders Amid Cyber Incident

Marks and Spencer has temporarily paused online orders on its UK, Ireland, and some international websites due to a cyber incident. The company is actively managing the situation with the help of experts to restore online operations while ensuring that customers can still browse products online and shop in stores.

Spark’s Take on GB:MKS Stock

According to Spark, TipRanks’ AI Analyst, GB:MKS is a Outperform.

Marks and Spencer receives a strong overall score of 72, driven by solid financial performance and positive corporate events. The company benefits from strong revenue and cash flow growth, which supports its strategic investments and debt reduction. Technical indicators suggest a stable market trend, while valuation metrics indicate a fair pricing relative to peers. Recent corporate events further bolster shareholder confidence, contributing positively to the stock’s outlook.

To see Spark’s full report on GB:MKS stock, click here.

Marks and Spencer Addresses Cyber Incident with Continued Operations

Marks and Spencer Group PLC recently experienced a cyber incident, prompting minor temporary changes in store operations to safeguard customers and business integrity. Despite the incident, stores, website, and app continue to function normally. The company has enlisted external cybersecurity experts to manage the situation and reported the incident to relevant authorities, emphasizing their commitment to customer trust.

Spark’s Take on GB:MKS Stock

According to Spark, TipRanks’ AI Analyst, GB:MKS is a Outperform.

Marks and Spencer receives a strong overall score of 72, driven by solid financial performance and positive corporate events. The company benefits from strong revenue and cash flow growth, which supports its strategic investments and debt reduction. Technical indicators suggest a stable market trend, while valuation metrics indicate a fair pricing relative to peers. Recent corporate events further bolster shareholder confidence, contributing positively to the stock’s outlook.

To see Spark’s full report on GB:MKS stock, click here.

Marks and Spencer Announces Share Capital Details

Marks and Spencer Group PLC has announced that its capital consists of 2,055,200,170 ordinary shares with voting rights, and it currently holds no shares 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.

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 reflects the company’s ongoing commitment to align the interests of its management with those of its shareholders, potentially strengthening its market position and enhancing stakeholder confidence.

Marks and Spencer Announces Share Awards for New CFO

Marks and Spencer Group plc announced a series of conditional share awards to Alison Dolan, the incoming Chief Financial Officer, under the company’s Restricted Share Plan. These awards, totaling 637,309 shares, are designed to compensate Dolan for forfeited awards from her previous role at Rightmove plc. The shares are set to vest on specific dates between 2025 and 2027, with the requirement for Dolan to maintain an equity position equivalent to 200% of her salary within five years. This move is part of the company’s strategic efforts to secure top talent and align executive interests with shareholder value.

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.