Next raises full-year forecast

Next is up 9% after the retailer raised its full-year profit forecast on the back of a solid Christmas performance.

Next is trading at 6060p, up 9% after the firm revealed an 11.9% increase in sales between 1 November 2013 and Christmas Eve, which was significantly above expectations. The firm’s financial year runs until 25 January, and it has increased its full-year profit forecast to between £684 and £700 million.

The fashion house has also paid a one-off dividend of 50p, a further sign that the company is confident about future earnings. The move makes the company more attractive to institutional investors who also seek investment income.

Next reported a 7.7% increase in store sales, but it was online business operations that truly shined; the company reported a 21% increase in online revenue in the run up to Christmas. This was in line with the rest of the retail industry.

This is the second time that Next has increased its profit forecast in the past six months; in October it raised its forecast to between £650 and £680 million.

The share price is in an uptrend and any pull-backs could provide a buying opportunity.

Next chart

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.