NEXT (LON:NXT) Announces Earnings Results

NEXT (LON:NXT) posted its quarterly earnings data on Thursday. The company reported GBX 364.30 earnings per share (EPS) for the quarter, Digital Look Earnings reports. NEXT had a net margin of 12.87% and a return on equity of 52.86%.

Here are the key takeaways from NEXT’s conference call:

• First-half performance exceeded expectations: group sales rose 9%, full-price sales increased 7.7%, and profit before tax grew 10.5%, while EPS benefited from early-year share buybacks. The interim dividend will rise 12.6% to 98p.
• International sales were particularly strong, with full-price sales up 24% and total sales up 26%, led by Europe and rapid growth in NEXT-owned brands. Management raised its full-year international sales-growth expectation to 20.5%, although it cautioned that prior Zalando-related growth will create a tougher comparison.
• NEXT lowered its U.K. second-half sales expectations amid anticipated pressure from fuel, wage and other inflation on consumers, forecasting full-year U.K. sales growth of 6.7% overall. Retail remains the main weak spot, with first-half like-for-like sales down 3.3%, and management acknowledged that its full-year retail outlook may be optimistic.
• The company completed £355 million of share buybacks in the first half and expects approximately £500 million of distributable cash for the full year, leaving scope for further buybacks, a special dividend or other capital returns. Management plans to increase leverage modestly while retaining about £300 million of liquidity headroom.
• Management highlighted ongoing productivity investments in warehouses, stores and technology, including agentic AI that could eventually improve development productivity by 30% by February 2028. However, warehouse automation still has service-level glitches at peak volumes, and the AI benefits remain longer-term targets requiring additional investment.

NEXT Price Performance

Shares of NXT traded up GBX 289.08 during mid-day trading on Thursday, reaching £148.49. 326,804 shares of the stock traded hands, compared to its average volume of 4,528,830. The firm has a fifty day moving average price of £151.21 and a 200 day moving average price of £139.61. The company has a market cap of £16.95 billion, a price-to-earnings ratio of 19.92, a price-to-earnings-growth ratio of 5.66 and a beta of 1.04. The company has a current ratio of 1.76, a quick ratio of 1.07 and a debt-to-equity ratio of 108.79. NEXT has a 1 year low of £112 and a 1 year high of £161.75.

Insider Buying and Selling at NEXT

In other NEXT news, insider Jeni Mundy bought 160 shares of NEXT stock in a transaction that occurred on Tuesday, August 11th. The stock was acquired at an average cost of £155.45 per share, for a total transaction of £24,872. Also, insider Jonathan Blanchard sold 18,012 shares of the company’s stock in a transaction dated Thursday, June 25th. The stock was sold at an average price of £148.02, for a total value of £2,666,136.24. 1.47% of the stock is currently owned by company insiders.

Analysts Set New Price Targets

A number of research analysts recently weighed in on NXT shares. Deutsche Bank Aktiengesellschaft reissued a “hold” rating and set a £140 price target on shares of NEXT in a research report on Thursday, August 6th. Berenberg Bank increased their price objective on shares of NEXT from £180 to £187 and gave the company a “buy” rating in a research note on Thursday, August 6th. JPMorgan Chase & Co. lifted their target price on shares of NEXT from £130.30 to £140.40 and gave the stock a “neutral” rating in a research report on Thursday, August 6th. Shore Capital Group restated a “buy” rating and issued a £175 target price on shares of NEXT in a research note on Thursday. Finally, Citigroup upped their target price on NEXT from £132 to £155 and gave the company a “neutral” rating in a report on Thursday, August 6th. Three equities research analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the stock. Based on data from MarketBeat.com, the stock currently has an average rating of “Hold” and a consensus price target of £153.55.

NEXT News Roundup

Here are the key news stories impacting NEXT this week:

• Positive Sentiment: NEXT reported quarterly EPS of 364.30 pence, alongside a strong 52.86% return on equity and 12.87% net margin. These figures reinforce the retailer’s robust earnings-generation and profitability profile. NEXT earnings report and conference call
• Positive Sentiment: Shore Capital reaffirmed its Buy recommendation and set a £175 price target, signaling continued confidence in NEXT’s outlook and potential upside. Shore Capital rating update

NEXT Company Profile

Founded as a tailoring business in Leeds in 1864 by Joseph Hepworth and Son, today, the company offers clothing, footwear, accessories, beauty and home products to our UK and International customers.

NEXT has over 500 stores in the United Kingdom and Eire, and over 180 franchise branches across Europe, Asia and the Middle East. The company’s main divisions are NEXT Online, NEXT Retail and NEXT Finance. We also launched Total Platform, an online, distribution, tech and logistics solution, in 2020.