JD Sports Fashion PLC's (LSE:JD.) new five-year plan was given rave review by analysts including Barclays and Shore Capital.
Following yesterday’s capital markets event, where chief executive Régis Schultz outlined the sportswear retail group’s five-year growth strategy, Shore Capital said the plan suggests “significant upside potential”.
Analysts at the broker nudged their fiscal year 2025 profit before tax estimates up by 2%, although there was no change to 2023 and 2024 numbers.
Growth, as outlined by the FTSE 100-listed retailer’s management, is anticipated to be split evenly between same-store sales and expansion of its retail space.
However, the broker believes sales from its expansion stores will surpass like-for-like sales in the coming years.
Additionally, the analysts believe the plan is backed by JD’s key partner brands like Nike, which will provide exclusive products for “years to come.”
Analysts at Barclays believe this is a key investment positive as it illustrates JD’s importance in the sector, setting it apart from its competitors which sell undifferentiated products.
"Crucially, this growth potential has been endorsed by the major brands, and c50% of product overall is exclusive to JD," said Barclays.
This is the first time JD has provided official top-line growth guidance, which Shore Capital believes provides credibility to the plan.
In a statement issued before the event, JD said it is planning to add 250 to 350 new stores annually for the next five years as part of its growth strategy.
Included within that is £500mln to £600mln of capital expenditure per year, with at least half focused-on store expansion in unpenetrated markets.