M&S could see crucial FTSE 100 comeback on soaring share price

By

Nigel TAYLOR

Published
Nov 11, 2021

After suffering a number of years in the financial doldrums - resulting in its relegation from the London Stock Market’s lead FSTE 100 index last year - M&S is bouncing back.

And after a strong set of trading results this week, marked by a long-awaited return to profit, analysts are also predicting a return to the FTSE 100 after its shares have surged almost 20%. They're currently trading at 231.6p, their highest level since spring 2019.

To qualify for automatic promotion from the FTSE 250, M&S would have to become at least Britain’s 90th most valuable listed company by December, when the next reshuffle of the index is scheduled.

That would be hugely important for it as being in the UK’s blue-chip index would mean that fund managers running index trackers would automatically have to buy the shares, giving them an extra boost.

However, chief executive Steve Rowe played down the significance of FTSE 100 membership, telling The Telegraph: “I have long since given up worrying about what goes on in the stock market. We are simply focused on delivering a good Christmas in the short-term and executing our plan, and the share price will react accordingly to that.”

With the long-awaited turnaround of its clothing business gaining momentum, the high street retailer posted half-year profits of £187 million yesterday  and expects annual profits to rise to £500 million. The gains gave M&S a stock market valuation of more than £4.4 billion.

M&S cautioned, however, that its resurrection is not complete. Supply chain disruption and the shortage of delivery drivers and warehouse staff, could still hamper progress. Rowe also warned that it will be up to nine months until supply chain pressures ease.