​​Marks & Spencer to announce improved earnings

​​​Higher M&S earnings expected

​Marks & Spencer's expected announcement of higher earnings for the six months ending in September is a testament to the company's turnaround. Pre-tax profits of approximately £270 million would mark a significant increase from the previous year, reflecting M&S's strong performance in the second half of the year, particularly during the crucial Christmas sales period.

​The positive outlook can be attributed to M&S's success in gaining market share in its clothing and home, as well as food businesses over the summer. This growth in market share has contributed to the optimistic earnings projection and demonstrates the effectiveness of the company's strategic initiatives.

​Investors buy back into M&S shares

​The market has responded favourably to M&S's recent success, as evidenced by the more than doubling of the company's shares in value over the past 12 months. This surge in investor confidence reflects the belief that M&S's growth trajectory is sustainable and that the company has successfully addressed the challenges it faced in the past.

​The reinstatement of M&S into the prestigious FTSE 100 index in September further highlights the company's resurgence. After being relegated to the second tier four years ago due to declining sales and fierce competition, M&S's impressive growth has allowed it to reclaim its position among the UK's top companies.

​Overall, M&S's expected higher earnings and positive market response underscore the effectiveness of the company's strategic efforts and its ability to adapt to changing consumer preferences. While challenges may still lie ahead, M&S's recent success positions it well for continued growth and profitability in the future.

​Analyst ratings for M&S

​Refinitiv data shows a consensus analyst rating of between ‘buy’ and ‘hold’ for M&S – 4 strong buy, 3 buy, 11 hold and 1 sell - with the mean of estimates suggesting a long-term price target of 243.06 pence for the share, roughly 10% higher than the current price (as of 06 November 2023).

​Technical outlook on the M&S share price

​M&S’s share price has been in a one-year uptrend and has more than doubled in value to its 245.9p September peak before consolidating and slipping to its mid-October low at 211.5p. This offered support since then and only a fall through this level on a weekly chart closing basis could lead to the 2022-to-2023 uptrend line at 200p being revisited.

​M&S Weekly Candlestick Chart

​While remaining above the 211.5p October low, upside pressure retains the upper hand with a rise above last week’s high at 229.2p remaining a distinct possibility. Once it and the August peak at 234.8p high have been exceeded, the September peak at 245.9p will be back in the frame, together with the minor psychological 250p mark.

​M&S Daily Candlestick Chart