3 Things to Love About Marks and Spencer Group

LONDON -- There are things to love and loathe about most companies. Today, I'm going to tell you about three things to love about FTSE 100 high-street icon Marks and Spencer Group (LSE: MKS  ) .

I'll also be asking whether these positive factors make M&S a good investment today.

Survivorbility
M&S, the iconic retailer of quality goods at a reasonable price, has been a fixture on the high street for more than a century. In 1998, the company became the first British retailer to make a pre-tax profit of over 1 billion pounds.

Over the past 15 years, M&S has had a tougher time. But "survivorbility" is the name of the game on the high street, and despite the knocks, the company keeps bouncing back.

Investor friendly
When companies talk about "trading in line with market expectations" (or below or ahead of expectations), it's often difficult for small shareholders to know what those expectations are. Forecasts on popular financial websites invariably differ and often to a considerable degree.

M&S is one of a minority of companies to publish its own analysts' consensus forecasts on its website. Furthermore, the forecasts are kept reasonably up to date (15 February at the time of writing). So, as these are not just any consensus forecasts, but M&S consensus forecasts, you always know where you are with what the company considers to be market expectations.

Shareholder perks
M&S has hundreds of thousands of small investors, many of whom shop in its stores. Shareholders receive perks along with the company's interim dividend paid in January. This year the perks consisted of one 10% off voucher, one M&S Cafe voucher and a selection of spend-&-save vouchers.

You only have to own a single M&S share to be entitled to the perks, so if you're a shareholder -- however small -- you should be getting them. If you're not, it's more than likely your shares are held with a nominee company that doesn't play ball with M&S on the scheme. All you have to do to get the perks in future is confirm your name, address and how you hold your shares with M&S's registrar on 0845 609 0810.

A good investment?
Using those analyst consensus forecasts I mentioned earlier, and a recent share price of 384 pence, M&S is trading on just under 12 times current-year earnings expectations. That's attractive relative to the market average, while an expected dividend of 17 pence for the year supports an above-market-average yield of 4.4%.

However, M&S's valuation was not appealing enough to qualify the share for this exclusive in-depth report, which is devoted instead to another strong dividend opportunity within the FTSE 100.

In fact, this alternative opportunity offers a prospective 5.9% yield, might be worth 850p versus around 700 pence now -- and has just been declared the "Motley Fool's Top Income Stock for 2013." Simply click here to download the report -- it's 100% free.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 2263601, ~/Articles/ArticleHandler.aspx, 4/17/2014 12:20:04 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement