Next earnings preview: Where next for the Next share price?

When will Next release 2022 earnings?

Fashion and homeware retailer Next is scheduled to release full year results for the year to the end of January 2023 on the morning of Wednesday March 29.

Next 2022 earnings consensus

Next is forecast to report a 5% rise in annual sales to £5.1 billion in 2022 and a 4.6% increase in pretax profits to £861.3 million, according to consensus numbers from Bloomberg.

Next 2022 earnings preview

Next sales continue to increase in what is proving to be a challenging environment for retailers as consumers are forced to spend more money on necessities in the inflationary environment. Next has won applause for how it has managed inventory and kept full-price sales growing, which is also helping protect profitability.

Next, which is known for under-promising and overdelivering, raised its pretax profit guidance for 2022 to £860 million back in January, with analysts anticipating a slight beat. Earnings per share is forecast to rise 5.8% to around 554p, outpacing the rise in pretax profit thanks to its share buybacks.

Next said it was ‘cautious’ about the year ahead when it released its last trading statement back in January, when it issued preliminary guidance for full price sales to fall 1.5% and for profits to drop 7.6% to £795 million.

Next is aiming to deliver around £77 million in cost savings over the coming year but this will not be enough to offset around £119 million of anticipated cost increases, driven higher wage and energy bills. That, twinned with lower sales, will pressure profit.

That suggests both growth and profits have peaked. Next tends to low-ball its initial view and then upgrade it as it gains more clarity on what lies ahead, although it has said that this may not be the case for the year ahead after warning it is ‘concerned some might look at our forecast for 2023 and again assume we are being over cautious’.

Still, sales and profits are still considerably larger than before the pandemic and yet the share price is still almost 6% below where it sat before the Covid-19 crisis derailed markets back in early 2020. In turn, that has spurred-on a rally in the Next share price, which has popped almost 50% since bottoming-out last October.

Where next for the Next share price?

The rally in Next shares has lost steam since they hit their highest level in over a year in early March.

We saw the stock briefly surpass the 6,970p level of resistance when it hit those highs but we can see this has proven a tough ceiling to crack over the past year. This is the first level that needs to be recaptured before that one-year high comes back into play and a move above 7,000p is back on the table. With that in mind, the 25 brokers that cover Next see limited upside from current levels with the average target price sat at 6,873.3p.

The two-month closing-low of 6,630p could provide some support if it comes under renewed pressure, although 6,400p looks like it could be a firmer level of support.

How to trade the Next share price

You can trade Next shares with City Index in just four easy steps:

Open a City Index account, or log-in if you’re already a customer.
Search for ‘Next’ in our award-winning platform
Choose your position and size, and your stop and limit levels
Place the trade

Or you can practice trading risk-free by signing up for our Demo Trading Account

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. 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.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.