Next PLC (LSE:NXT) shares fell on Thursday as investors were expecting another full-year profit guidance upgrade that did not arrive, analysts said.
Instead, the clothing chain reiterated its outlook, laced with some cautious comments about "anaemic" UK economic growth.
Deutsche Bank said it was a "good" first half but with no update on current trading, "there is still uncertainty on the horizon".
However, UBS said that while the lack of an upgrade could be disappointing, the first-half results highlighted that the FTSE 100 company "is in rude health".
After management laid out the growth opportunities that are being pursued, the UBS analysts said they see three positives for investors with a medium-term view.
First, the importance of "following the money", as this is how Next explained the framework for how they pursue multiple growth opportunities, which "talks to the exciting growth period" the company is in and how they aim to grow "all" their profitable revenue streams.
While cautious on the UK as a whole, Next said positives for the company "materially outweigh" negatives.
Third, with a strong balance sheet, UBS picked up signals that the group intends to use the under-leveraged balance sheet, to step up returns in the long term, and so has raised its share buyback forcast from £350 million a year from 2027 onwards to £400 million.
At Peel Hunt said it was noted that the H1 performance had seen upgrades each quarter, reflecting favourable weather conditions and disruption at rival M&S.
On the latter point, analysts pointed out that Next had flagged a 12% increase in non-credit customers this half, much higher than normal.
"Overall, this is a confident statement, tempered by concerns over a stagnant UK economy. The benefits of increased warehouse efficiency and online capability is clearly driving profitability, with international and wholly owned brand and licenses making a significant contribution to growth," the broker said.
Robinhood UK analysts said Next "could easily have been a real casualty of the digital age" but has "shown its ability to not only stay relevant but prosper, thanks to its ability to adapt and benefit strategically from online retail".
"While the fast fashion brands have blazed and faded, Next has nurtured its brand portfolio, online platform and customer base steadily in a real tortoise and hare story."