2 top FTSE 100 retail stocks I’d buy now

As the economy gets one step closer to fully reopening, I’m checking out these two top FTSE 100 retail stocks to add to my portfolio today.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

With customers of physical stores forced online by Covid-19, my interest in these two top FTSE 100 retail stocks — which are making the most of the online shift — is growing. 

When I saw the recent results of retailer Superdry, I wanted to find more long-term buy-and-hold opportunities in the clothing retail sector. I looked at JD Sports (LSE: JD) and Next (LSE: NXT). 

JD Sports Fashion

When it comes to British leaders in sports fashion, JD Sports is up there. This FTSE 100 retail stock has been — like the rest of the retail sector globally — undergoing a significant shift to omnichannel, while its share price has jumped almost 70% in the past year, from 539p to 916p.

Impressively, despite the widespread closure of its physical locations, JD Sports made an enviable pre-tax profit of £421.3m in 2020 — down just 5% year-on-year (YoY). What’s more, rapid e-commerce growth helped overall revenue increase 1% YoY to £6.16bn. 

I am very excited by the prospect of store reopenings, which should further boost JD Sports’ income stream. The FTSE 100 member has already proven that it can be a dual-front e-commerce/brick-and-mortar revenue-generating machine. This could grow even more thanks to international growth, with 55% of total sales now coming from both mainland Europe and the US.  

A couple of things concern me though. The sports fashion industry is hugely competitive, and in order to expand internationally, as it has been doing, it will need to spend more money. This could lead to overstretched resources if JD is not careful. Another concern is the rumours that long-time executive chairman/CEO Peter Cowgill may be stepping down from day-to-day control and handing over to a new CEO. This could cause some short-term volatility as is common following upper management shake-ups.

I’m still very bullish on this retailer, and at around 916p now, I believe it still has some runway for growth as the economy reopens. 


Considered to be one of the top UK reopening stocks to buy, the Next share price is on the rise. In the past year, the British retail firm has risen more than 70% from 4,796p to 8,320p. 

This top FTSE 100 retailer, like JD Sports, fared well in 2020, despite the pandemic. While its stores were closed, online sales surged, which saw revenue fall just 17% from £4.27bn to £3.53bn. What’s more, it managed to retain a pre-tax profit of £342m, despite increased Covid-19 costs. 

Next’s management’s bullish forecast for the coming year. It recently raised its central guidance for a full-year profit before tax by £20m to £720m. In fact, according to its first-quarter results, Next is already back to pre-pandemic levels of business, with a comprehensive expansion policy in place. This includes standalone premium beauty stores, deals with Laura Ashley and Victoria’s secret, more third-party brands added to its Label offer, and growing its e-commerce solution for external businesses.

Much like JD though, Next operates in a massively competitive market. It will need to invest heavily in its marketing and online retail just to stay ahead of the competition, all of which will impact its ability to generate meaningful profits.  

I am still bullish about Next though, and its brand power, which has seen it rise to the top of its market and remain in the FTSE 100.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Jamie Adams holds no position in any companies mentioned above. The Motley Fool UK owns shares of Next. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Investing Articles

After falling 9% in 6 weeks, is this FTSE 100 stock now in bargain territory?

The BAE Systems share price hit a 52-week high on 3 June. Six weeks later, it’s down nearly 10%. Is…

Read more »

Smiling white woman holding iPhone with Airpods in ear
Investing Articles

I love the look of Entain shares, potentially 47% undervalued

Many FTSE 100 companies have been on a tear in 2024, but with Entain shares down nearly 50%, I think…

Read more »

Investor looking at stock graph on a tablet with their finger hovering over the Buy button
Investing Articles

Could Aviva shares reach £5.84 in the next 12 months?

Some analysts think Aviva shares could soar nearly 19% in the next year. This Fool takes a closer look to…

Read more »

Investing Articles

I’m looking at a once-in-a-decade chance to buy dirt-cheap FTSE dividend shares

Harvey Jones says FTSE 100 dividend shares have been showing signs of life lately but they're still cheap and there's…

Read more »

Arrow symbol glowing amid black arrow symbols on black background.
Investing Articles

If I’d put £10k in BAE Systems shares 10 years ago, here’s what I’d have now

BAE Systems shares have been on fire over the last decade. But just how much would a £10k investment back…

Read more »

The flag of the United States of America flying in front of the Capitol building
Investing Articles

My favourite S&P 500 stock is still potentially 52% undervalued

The S&P 500 is where many investors look for the next opportunity, but one of my favourites might just be…

Read more »

Smartly dressed middle-aged black gentleman working at his desk
Investing Articles

Here’s why I’m watching the Glencore share price

The mining sector has always been volatile, but with some recent strategic moves, I'm watching the Glencore share price even…

Read more »

Young black female footballer training on stadium pitch
Investing Articles

My JD Sports Fashion share price prediction for the second half of 2024

The JD Sports Fashion share price hasn't yet recovered from January’s slump. So will the retailer's stock bounce back in…

Read more »