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Next Plc’s share price has made a strong comeback in recent weeks, reflecting investor confidence in the company’s steady recovery. The shares have climbed to a high of 6,894p, the highest since February 28th this year, marking a 20% increase and outperforming competitors like Boohoo and Asos.
In the past few months, Next’s share performance had struggled due to rising business costs. Wages and logistics expenses have surged, and UK retail spending has been hit hard by inflation, leading to a significant drop in retail sales.
This week, all eyes will be on Next PLC as it prepares to release its second-quarter trading update. Analysts expect the company’s results to be lower due to inflation and actions by the Bank of England.
In May, Next reported a 21.3% increase in full-price sales, including interest income. For the full year, the company projects a profit before tax of around £850 million and earnings per share of approximately 557p.
Several factors could boost Next PLC’s share price further. The company recently announced plans to return a £220 million surplus to shareholders through dividends or buybacks. Additionally, the UK’s low unemployment rate could increase demand for Next’s products.
The daily chart shows that Next’s stock has been on an upward trend recently. It has broken through the significant resistance level of 6,646p, which was its highest point on May 31st, and has surpassed both the 25-day and 50-day moving averages. The stock has also moved above the 38.2% Fibonacci Retracement level.
Given these trends, Next PLC’s share price is likely to continue rising, with bulls aiming for a key resistance level of 7,200p. A drop below the support level of 6,500p would negate this optimistic outlook.