NEXT (LON:NXT) Issues Quarterly Earnings Results

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

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 Stock Performance

Shares of NEXT stock opened at £142.20 on Friday. The company has a debt-to-equity ratio of 108.79, a quick ratio of 1.07 and a current ratio of 1.76. The business’s 50 day moving average price is £151.21 and its 200 day moving average price is £139.61. The company has a market cap of £16.23 billion, a price-to-earnings ratio of 19.08, a PEG ratio of 5.66 and a beta of 1.04. NEXT has a one year low of £116.15 and a one year high of £161.75.

Insider Activity

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

Analysts Set New Price Targets

A number of research firms have issued reports on NXT. Citigroup raised their price target on shares of NEXT from £132 to £155 and gave the stock a “neutral” rating in a research report on Thursday, August 6th. Deutsche Bank Aktiengesellschaft restated a “hold” rating and issued a £140 target price on shares of NEXT in a research note on Thursday, August 6th. Peel Hunt reissued a “hold” rating and set a £139 price target on shares of NEXT in a report on Wednesday, August 5th. Berenberg Bank restated a “buy” rating and issued a £187 price target on shares of NEXT in a research note on Friday. Finally, JPMorgan Chase & Co. raised their price objective on NEXT from £130.30 to £140.40 and gave the company a “neutral” rating in a report on Thursday, August 6th. Three investment analysts have rated the stock with a Buy rating and five have given a Hold rating to the company’s stock. According to data from MarketBeat.com, the company currently has an average rating of “Hold” and an average target price of £153.55.

About NEXT

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.