Next (NXT.L) 1H27 results demonstrate ongoing strong earnings momentum, underpinned by the hyper growth, immature Internatio...

Equity Research 18 September 2026 | 5:13PM BST

Next (NXT.L) 1H27 results demonstrate ongoing strong earnings momentum, underpinned by the hyper-growth, immature International division; PT to 17,000p, remain Buy-rated

NXT.L 12m Price Target: 17,000p Price: 14,920p Upside: 13.9% BUY Richard Edwards GS View: Next’s 1H27 results highlighted ongoing strong operating | Goldman Sachs International momentum for the business despite a difficult macroeconomic backdrop Ben Williams in the UK and Europe. While full-price sales of +7.7% were broadly in line | Goldman Sachs International with expectations, driven by strong growth in international, PBT of £569mn was a modest beat and FY27 guidance was modestly raised. Hamish Bogdan | Goldman Sachs International Importantly, the return on marketing spend for international continues to run well above the company’s internal target of £1.5 of profit for every £1 spent, providing ample headroom for further investment in 2H, which Key Data _____________________________________ Market cap: £17.9bn / $23.8bn should underpin strong international growth despite tougher Enterprise value: £19.7bn / $26.3bn 3m ADTV: £45.0mn / $60.5mn comparatives. Looking ahead, we continue to believe Next offers a rare United Kingdom combination of good top-line growth and strong free cashflow Europe General and Food Retail M&A Rank: 3 generation: with our FY27 PBT forecast increasing moderately to Leases incl. in net debt & EV?: Yes

£1,260mn and PT to 17,000p, we remain Buy-rated. GS Forecast __________________________________ 1/26 1/27E 1/28E 1/29E

1H27 PBT £569mn, +10.5% yoy with the modest beat coming from Revenue (£ mn) New Revenue (£ mn) Old 6,291.5 6,291.5 6,744.9 6,726.5 7,143.9 7,115.5 7,606.8 7,571.2 the UK Online performance. 1H full-price sales pre-announced and EPS (p) New EPS (p) Old rose +7.7%, with Retail -1.7%, Online (UK) +7.4%, Online P/E (X) (International) +23.9% and Next Finance +0.9%. Dividend yield (%) 5.2 3.0 5.1 2.3 FCF yield (%) 6.1 4.7 5.0 5.7 CROCI (%) FY27 guidance updated: 1) Full-price sales guidance +6.7% yoy; N debt/EBITDA (ex lease,X) 0.6 0.6 0.6 0.6 total group sales guidance of +6.9% yoy; 2) Next UK guidance for 1/26 7/26 1/27E -- the year is +2.7% yoy; 3) International Online sales guidance +22.2% EPS (p) --

yoy; 4) PBT guidance £1,255mn. GS Factor Profile ______________________________ Growth Implications: On the back of the above results, we increase our FY27 forecast for Retail and Online sales growth to +7.2% (from Financial Returns

+6.9%), split Retail/Online -0.2%/+10.4% (from -0.9%/+10.3%), Multiple

with our FY27 PBT forecast increasing to £1,260mn (from Integrated

£1,246mn). Our financial forecast assumptions are set out below. PT to 17,000p; Buy-rated. Percentile 20th 40th 60th 80th 100th

NXT.L relative to Europe Coverage NXT.L relative to Europe General and Food Retail

Source: Company data, Goldman Sachs Research estimates. See disclosures for details.

Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to Analysts employed by non-US affiliates are not registered/qualified as research analysts with FINRA in the U.S.

Next (NXT.L) Balance Sheet (£ mn) _______________________________________ BUY Rating since Apr 14, 2025 1/26 1/27E 1/28E 1/29E Cash & cash equivalents Accounts receivable 1,660.6 1,780.3 1,885.6 2,007.8 Inventory 949.5 1,017.9 1,078.1 1,148.0 Ratios & Valuation __________________________________________ Other current assets /26 1/27E 1/28E 1/29E Total current assets 2,742.4 2,930.5 3,052.8 3,273.0 EV/sales (X) 2.5 2.8 2.6 2.4 Net PP&E Lease adj EV/EBITDAR (X) Net intangibles EV/EBIT (X) Total investments P/E (X) Other long-term assets CROCI (%) Total assets 4,915.3 5,164.5 5,342.9 5,589.2 FCF yield (%) 6.1 4.7 5.0 5.7 Accounts payable 1,132.4 1,215.5 1,331.0 1,473.1 Dividend yield (%) 5.2 3.0 5.1 2.3…