eyeQ: the most important thing to watch at Next
Experts at eyeQ have used AI and their own smart machine to analyse macro conditions and generate actionable trading signals. Here’s what’s driving sentiment at the FTSE 100 retailer.
6th January 2026 10:20
by Huw Roberts from eyeQ
Shoppers outside a Next store on Oxford Street, London, in October 2025. Photo: Mike Kemp/In Pictures via Getty Images.
“Our signals are crafted through macro-valuation, trend analysis, and meticulous back-testing. This combination ensures a comprehensive evaluation of an asset's value, market conditions, and historical performance.” eyeQ
- Discover: eyeQ analysis explained | eyeQ: our smart machine in action | Glossary
Next
Macro Relevance: 52%
Model Value: 13,927.28p
Fair Value Gap: +0.45% premium to model value
Data correct as at 6 January 2026. Please click glossary for explanation of terms. Long-term strategic model.
Next shares are up this morning after its latest trading update. It provided its usual mix of good news on profits for this year and guidance for the year ahead; but tempered that with a more cautious outlook, citing a shaky labour market and slower economic growth.
Crudely, the suggestion is that Next (LSE:NXT) is a well-run outfit constrained only by broader macroeconomic forces. So, what does eyeQ’s macro model say?
This latest rally has brought Next back in line with macro conditions. The stock started 2026 trading 4% cheap on eyeQ (that wasn’t sufficient to trigger a bullish signal) and now sits very close to our model fair value.
When a stock is close to fair value, that means the most important thing to watch is model value itself. Remember, eyeQ’s model value states where the share price “should” trade given the broad macro environment. It’s a measure of macro momentum - do macro conditions support the share price, or are they working against the stock?
Right now, macro is a modest tailwind. eyeQ model value is up nearly 2% over the last month. The stock had been modestly lagging that but has now caught up.
One of the biggest drivers is inflation expectations where the relationship is negative, i.e. Next wants lower UK inflation, which presumably reflects higher prices fuelling affordability issues, hurting consumer spending power.
Finally, note that macro relevance of 52% means the stock isn’t in a fully fledged macro regime, but big-picture stuff such as growth and inflation do explain just over half of moves in the stock price. So, company fundamentals matter, but as management said, the macro outlook is important too.
Source: eyeQ. Past performance is not a guide to future performance.
Useful terminology:
Model value
Where our smart machine calculates that any stock market index, single stock or exchange-traded fund (ETF) should be priced (the fair value) given the overall macroeconomic environment.
Model (macro) relevance
How confident we are in the model value. The higher the number the better! Above 65% means the macro environment is critical, so any valuation signals carry strong weight. Below 65%, we deem that something other than macro is driving the price.
Fair Value Gap (FVG)
The difference between our model value (fair value) and where the price currently is. A positive Fair Value Gap means the security is above the model value, which we refer to as “rich”. A negative FVG means that it's cheap. The bigger the FVG, the bigger the dislocation and therefore a better entry level for trades.
Long Term model
This model looks at share prices over the last 12 months, captures the company’s relationship with growth, inflation, currency shifts, central bank policy etc and calculates our key results - model value, model relevance, Fair Value Gap.
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