- Marks & Spencer Group
- 16 September 2024 10:16:38
Source: Sharecast
The bank said the M&S share price has performed well year-to-date but it sees further upside driven by food outperformance, clothing full price sales and the retailer’s strong cash generation.
"Food price and value perception strong," RBC said. "We think other grocery retailers have been more focused on loyalty and the value end of their offers.
"Also, the eating out to eating in trend has helped M&S in our view."
RBC noted that for the latest 12 weeks to 1 September, Kantar data suggested food value growth was 11.7% year-on-year versus the market at +3.4%, with volume growth at +9.4%, versus 1.5% for the market.
"However, M&S' H1 result will be affected by the lack of an Easter food shop and no Coronation this year," it added.
As far as clothing is concerned, RBC said M&S "held its nerve over the summer".
"We note that M&S didn't go on sale until August this year. We also think it has seen a positive margin mix effect from Autograph outperformance," it said.
At 1015 BST, the shares were up 2.1% at 358.40p.