Should I Invest in Marks and Spencer Group Plc (MKS)?

3. Growth: All of revenue, earnings, and cash flow have been flat. Score: 3/5

4. Price to earnings: A forward 11 looks fair compared to growth and yield forecasts. Score: 3/5

5. Outlook: Recent trading is mixed, and the outlook is cautious. Score: 2/5

Overall, I score Marks & Spencer 14 out of 25, which makes me cautious about the firm’s potential to outpace the wider market’s total return going forward.

Foolish summary
Although dividend cover is satisfactory, the firm has a lot of debt, which could cause difficulties if the decline in high-street sales accelerates. Financial performance has been flat, and the outlook is cautious. I think Marks & Spencer’s valuation reflects its prospects.

The article Should I Invest in Marks & Spencer? originally appeared on Fool.com and is written by Kevin Godbold.

Kevin does not own shares in Marks & Spencer Group.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.