Broker ideas M&S shares to hit their highest degree since 2015

Broker Peel Hunt has upgraded its expectations for Marks & Spencer’s shares, with analysts backing the retailer’s ambitious food-only expansion plans.

M&S, which will next week update investors on its first half performance, has become Britain’s fastest growing supermarket under the leadership of boss Stuart Manchin.

Machin has helped lure in shoppers despite a tough consumer backdrop as M&S has invested in larger food halls and launched new products.

It has helped drive M&S shares almost 40 per cent higher since the start of 2024. They have added more than 75 per cent over the last 12 months.

Peel Hunt on Friday hiked its M&S share price target from 360p to 425p – 12.7 per cent above their current level of 377.1p as of midmorning.

It follows another vote of confidence from analysts at UBS, which in September upgraded its M&S target share price to 435p – higher than at any point since December 2015.

M&S opened four food-only stores in the first half of the financial year, with plans to open five more in the second half and 10 more next year.

It is hoping to grow its food-only offering from 325 to 400 sites nationwide.

Peel Hunt analysts said a recent trip to M&S’s new Friern Barnet store – a 18,000 square-foot site previously hosting a Furniture Village – showed the value of the retailer’s recent investments.

‘The maths clearly works given the immediate sales densities,’ they added.

‘M&S is not going mad with its opening programme, but stores like Friern Barnet show what a potent model M&S now has for new/refitted stores.

‘The interims on 6 November should showcase a good, if not great 1H, but current trading is probably decent, judging by the weather. An upgrade is possible, and as the consumer starts to gain confidence, the risk profile has changed.’