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Next (first-half earnings 14 September)
Next has gone from growth star to potential value play. Repeated profit warnings underscore just how far this darling has fallen. However, cash return is expected to improve, with £275 million of payouts in four special dividends, while the Next Directory has shown resilience in otherwise difficult times. At just 10.9 times forward earnings versus 17.9 for comparable firms, the shares look to have plenty of bad news priced in. First-half results are expected to see earnings of 1.62p per share, down 13% year-on-year, while revenue is forecast to remain relatively flat at £1.9 billion.
Next shares broke the downtrend from the all-time high in early August, pushing back to £45. This crucial area of resistance is still unbroken however, which suggests weakness towards £40 and then £35.
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