November proved to be a tough month for the Marks & Spencer (LSE:MKS) share price. It was one of the worst-performing stocks in the FTSE 100, falling almost 14% in the month. Here’s what caused the move and where I think it could go from here.
Key factors to note
In April 2025, the business was subject to a severe cyber incident that forced the company to halt online orders and disrupt its logistics systems. The full impact of this wasn’t evident until the half-year results came out at the beginning of November. It showed that its underlying pre-tax profit for the six months fell by 55% to £184.1m. A big factor in this came from the one-off hit from the cyber attack.
Even though investors have known about the attack for months, it’s only now become apparent what the full extent of the damage is. As a result, the share price fell as sentiment soured following the results.
More than this, CEO Stuart Machin said recovery after the cyber-attack had slowed, saying stock availability and general logistics weren’t back up to speed as quickly as planned. This is concerning as it could mean that performance could be impacted in future quarterly financial updates. This readjustment in investor expectations was another factor in the November fall.
Finally, there was concern around the latest UK Budget. With more people feeling a squeeze on their pay, Marks & Spencer could see lower demand from the cost-of-living pressures. These could discourage discretionary spending and push customers to cheaper alternatives.
The direction from here
When I wrote about the company last month, I made two key points about why I don’t think the company’s best days are behind it. To begin with, it appears attractively valued based on its current price-to-earnings ratio. This is 10.97, well below the FTSE 100 average of 18.2. So I struggle to see the share price falling materially in the coming months, as value hunters would likely step in.
The other factor is fundamental growth. The company is still pushing ahead with store expansions, renovations, and a push on the (already) strongly performing food business. It’s doing well in the strategy decisions for long-term success. So when we put the one-off hit from the cyber attack, there’s still a compelling reason to want to own the stock.
Of course, nothing is for certain. I think one risk is further cyber attacks, along with general customer concerns about shopping with the company and handing over their payment data.
The November decline means the stock is down 9% over the past year. Yet when we zoom out a bit further, it’s still up 180% in the last three years. So, on balance, I think the move lower in November represents a good potential buying opportunity for consideration by investors.
