The imminent departure of boss Steve Rowe from Marks and Spencer Group PLC (LSE:MKS) should not affect investor sentiment towards the retailer, Deutsche Bank believes.
“This management change has been well flagged and reflects the very strong bench of talent that Archie Norman has helped build up at M&S,” the broker said.
Deutsche raised an eyebrow at the proposed switch to a co-CEO (chief executive officer) structure and said it could lead to questions of responsibility and accountability.
The broker’s guess is that the switch was made to keep both of the soon to be co-CEOs happy and on the team.
“Stuart Machin is in charge of day-to-day leadership and he has done a good job on the food side of the business to improve the market share, innovation and value credentials of the business (all which will be tested by the consumer income squeeze we are set to see in 2022),” Deutsche said.
The broker rates the shares a buy and has a target price of 260p.