Marks & Spencer (LON: MKS) shares are “meaningfully undervalued,” according to analysts at Shore Capital, who welcomed the company’s newly announced international wholesale partnership with Australian department store chain David Jones.
MKS shares currently trade around the 327.9p mark, down over 13% this year.
The company announced that it is partnering exclusively with David Jones to bring M&S Fashion to customers in Australia.
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The tie-up marks M&S’s first international wholesaling deal in fashion, following a similar arrangement in food with US retailer Target.
David Jones will begin selling M&S-branded womenswear, menswear and lingerie across 24 stores in Australia, as well as online.
While the deal is not expected to contribute to earnings in fiscal year 2026, Shore Capital sees it as a promising development within a broader strategy to rebuild international profitability.
“We welcome this modest move,” the firm wrote, noting that alongside easing losses at Ocado Retail and ongoing progress in the UK and Ireland, the new agreement “sustain[s] the sequential growth of the firm.”
M&S reported £46 million in international EBIT for FY25, down from £130 million in FY19.
However, Shore Capital expects that to rise to £65 million by FY27 and £75 million in FY28, as part of a recalibrated, capital-light strategy focused on franchising, wholesale, and online growth.
The broker, which has M&S as a “House Stock,” also highlighted the company’s “immense progress” in its core domestic business.
It stated that management remains aware of past underperformance abroad but is now focused on building a more efficient, omnichannel international operation.
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