“Hard to know what to make of this and my last visit to a Next shop seemed analogous to a ghost town… Dividend is flat - no increase – no mention of special divis… What to do - sitting on a 20% gain - tempted to take it today.”
I have a lot of time for NXT management - albeit pretty much all down to his Lordship, I suspect. And having now been through the statement in detail, you have to credit (once again) the best-in-class disclosure and reporting - insightful, transparent and candid as ever. I think any investor anywhere in UK Retail - probably elsewhere too - should be reading this, particularly the analysis and breakdown of the various risks and challenges, both cyclical and structural, facing NXT, the whole retail sector and much of the UK economy in general.
But in that context, a bit churlish to cry “no mention” of special divis, Games? And fundamentally incorrect - they’re very clear on specials, you are going to get none, this year at least… but there will be another £275m in buy-backs. As things stand, anyway - forecasts, and policy, will doubtless be subject to change as the year progresses.
As to what to do with your shares… you can argue for some kind of premium for management here, and you’d back them to do at least as well as any other player in negotiating the various challenges. But as they admit themselves, most of the pressures they face are external in nature, and I would never push the “premium sector play” argument too far.
I don’t think NXT is any worse than “fair value” around £50 (as I’ve opined before), but they are still “expensive” (maybe, less cheap) relative to a number of peers, at least some of which have advantages and/or qualities not enjoyed by NXT. I don’t see too much risk in holding on here, but there are quite a few I’d be buying before them.