Marks and Spencer Group PLC 

Marks and Spencer Group PLC (LSE: MKS) is an FTSE 250 index-listed supplier of clothing, footwear, home furnishings, beauty care, accessories, and food products through a network of retail stores and online channels..This Report covers the Investment Highlights, Conclusion, and Recommendation on the stock.

Investment Rationale – Sell at GBX 272.60

• Resistance near Current levels: MKS stock price crossed the Resistance (R1) stated in the previous report on 22 April 2024, and might witness some sell-off from the current levels. Considering the market conditions and the price action, it is prudent to exit the stock, as the prices might pull back from these levels.
• Deteriorating liquidity profile: The group’s quick ratio for H1 FY24 was reported at a lower level of 0.43x, as compared to the industry median of 0.88x. Further, the company’s current ratio was stated at 0.80x for H1 FY24, against the industry median of 0.88x.
• Inefficient Debt Management: During H1 FY24, the company reported a higher Debt/ Equity ratio of 1.16x, when measured against the industry median of 0.88x. Further, the % of long-term Debt to the Total Capital of MKS was 48.2% in H1 FY24, as compared to the industry median of 27.2%.

Share Price Chart  

Conclusion

Based on the notional gains, macroeconomic challenges, and price action stance, a "SELL" recommendation Marks and Spencer Group PLC (LSE: MKS) has been given at the closing market price of GBX 272.60 (as of 10 May 2024).

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is 10 May 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level which the stock is expected to reach as per the relative valuation method and/or technical analysis taking into consideration both short-term and long-term scenario.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’

Note 6: Dividend Yield may vary as per the stock price movement.