​​​​​Next shares close to 2024 highs ahead of full-year results

​​​Next earnings – what to expect

​Next reports full-year earnings on 21 March. Revenue is expected to come in at £1.86 billion, down from £1.87 billion last year. Meanwhile, pre-tax profit is forecast to surge to £931 million from last year’s £869 million.

​Recent performance – strong Christmas leads to upgraded forecast

​Next reported strong Christmas trading, with full-price sales up 5.7% in the nine weeks to December 30th, well ahead of its 2% growth expectations. This was driven by a 9.1% increase in online sales, while retail store sales grew more modestly.

​As a result, Next upgraded its full-year pre-tax profit guidance by £20 million to £905 million. It expects net debt to fall from £797 million to around £700 million for the year.

​​For fiscal 2024/25, Next forecasts pre-tax profits rising further to around £940 million, despite acquisition charges. Net debt is projected to decline to £625 million.

​The positive update sent Next shares 5.4% higher. Analysts praised Next's ability to drive full-price sales and avoid discounting, protecting its industry-leading margins. The fast-growing online division now makes up over half of total sales.

​Returns to shareholders to continue

​While economic headwinds persist, Next is seen weathering the storm well thanks to its strong brand, digital capabilities, and out-of-town store footprint. The company plans to return around £525 million to shareholders in 2024/25 through dividends and buybacks.

​Technical analysis on the Next share price ahead of Thursday’s Q4 trading statement

​Next’s share price, up around 5.5% year-to-date and by 28% over the past year, surpassed its September 2021 peak at 8,472p and has so far risen to an all-time record high at 8,646p in January. Since then it has range traded between this high and its mid-February low at 8,072p.

​Next Monthly Chart

​While the October-to-March uptrend line at 8,290p underpins, immediate upside pressure should be maintained. Above it meanders the 55-day simple moving average (SMA) at 8,400p.

​Next Daily Chart

​Key resistance sits between the January-to-March highs at 8,608p to 8,646p which has so far been tested four times this year but not broken through.

​A rise and daily chart close above the 8,646p January peak would put the psychological 9,000p mark on the map.

​Analysts recommendations and IG sentiment

​Fundamental analysts are rating Next as a ‘hold’ with Refinitiv data showing 2 strong buy, 5 buy, 15 hold, zero sells but 1 strong sell - with the mean of estimates suggesting a long-term price target of 8,328 pence for the share, roughly 2% above the share’s current price (as of 18 January 2024).

​IG sentiment data shows that 71% of clients with open positions on the share (as of 18 January 2024) expect the price to fall over the near term, while 29% of clients expect the price to rise. Trading activity today shows 56% of sells this month.