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I imagine that some FTSE 100 shares are actually extra engaging than ever on account of market volatility.
Why have FTSE 100 shares struggled?
To begin with, macroeconomic volatility has hampered many markets the world over. This consists of hovering inflation and the measures to counteract this, particularly larger rates of interest.
Within the case of the UK, extra points together with a cost-of-living disaster in addition to the looming spectre of a housing crash. Plus, overseas buyers are unsure of the course of the UK economic system on account of Brexit and have due to this fact cooled their funding pursuits.
Lastly, tragic geopolitical occasions on the planet at current haven’t helped.
Regardless of all this, some FTSE 100 shares have been thriving. Marks & Spencer (LSE: MKS) is one.
Am I too late to the social gathering?
Marks and Spencer is likely one of the largest retail chains within the UK promoting garments, homeware and meals. It has 400 retailer places within the UK and 150 abroad in addition to an excellent on-line presence.
As I write, Marks shares are buying and selling for 212p. Presently final yr, they had been buying and selling for 106p, which is a 105% enhance over a 12-month interval! That’s outstanding contemplating FTSE 100 shares have primarily stuttered previously few months.
Why have Marks and Spencer shares been flying? I imagine that is partly on account of its wonderful efficiency for 2023. Revenues elevated by a wholesome 9.6% to £11.93bn in comparison with the earlier yr. Moreover, pre-tax revenue jumped by near 22% to £475.7m.
Plus, the Q1 buying and selling replace launched a few months in the past additionally made for good studying. The enterprise mentioned that it had managed to extend market share within the meals and garments section. Like-for-like meals gross sales elevated by 11% in comparison with the identical interval final yr and meals gross sales grew by 6%. Regardless of difficult circumstances, the enterprise appears prefer it’s doing very nicely.
Lastly, Marks shares nonetheless look respectable worth for cash on a price-to-earnings ratio of 11. FTSE 100 shares’ common ratio is round 14. So even after the speedy share value rise, the shares look good worth.
Dangers and what I’m doing now
One difficulty that would influence Marks is the actual fact it’s considered as a extra premium retailer. As a result of cost-of-living disaster, there’s a likelihood that buyers might flip in direction of cheaper alternate options and this might hinder Marks and Spencer’s efficiency. This doesn’t seem like it has had an influence thus far however the subsequent replace is coming in November and I’ll be watching with curiosity.
Plus, because the Marks share value has soared so remarkably in current occasions, even a small bump within the highway might ship the shares tumbling.
I do just like the look of the Marks shares and despite the fact that I’m a bit late to the social gathering, I’d nonetheless be keen to purchase some shares for my holdings once I subsequent have some spare money to speculate. Marks is certainly one of a lot of FTSE 100 shares bucking common developments and doing nicely.
