LONDON (ShareCast) - (Sharecast News) - Analysts at Deutsche Bank lowered their target price on clothing and home products retailer Next from 6,200.0p to 5,700.0p on Wednesday.
Deutsche Bank said it had been a number of years since Next had taken such a cautious view on the outlook for the business for the outer year and highlighted that this time, there was little reference to the actual consumer outlook.

"The sales expectations for the remainder of 2H were trimmed by -3% to give -2% full price sales. This feeds through into a small circa 2% PBT downgrade to £840.0m (from £860.0m).

However, Deutsche Bank said this was not the main news from Next, with the group's main callout being the potential impact of foreign exchange in 2023 and the wider impact on maintaining elevated levels of inflation for the consumer.

"We have called out the higher prices required for clothing retailers to maintain % EBIT margin and Next suggested that this is unlikely to be achieved in 2023 which puts pressure on gross margin," said DB, which reiterated its 'hold' rating on the stock.







Reporting by Iain Gilbert at Sharecast.com

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