JD Sports Trade Insight

10-09-24

On August 22, JD Sports posted a 2.4% increase in underlying sales for the second quarter, showing progress compared to the prior quarter. However, the company expressed caution regarding its outlook for the remainder of the year due to ongoing global economic uncertainties, with a question still around interest rates and October’s Labour budget.

The FTSE 100-listed firm maintained its full-year 2024/25 profit forecast, expecting a pre-tax and adjusted earnings range of £955 million to £1.035 billion, up from the £917.2 million recorded in 2023/24.

There have also been rumours of a takeover recently, as market sources in early August had said there were reports of a potential strategic buyer being interested in JD Sports (Reuters London). However, the chief executive of British sportswear retailer JD Sports Fashion said he had “no comment on rumours” when asked by Reuters about recent bid speculation in the group.

If you look at the chart below, since the spike up on earnings on 22nd August, we rallied up to 150 from 128 within two days. Having then pulled back to the original point of volatility, we have now broken the short-term daily trend and are still above the 20, 50 and 100 day moving averages.

After a break above the 150 level on 23rd August, we would then look to test the yearly highs of 166.60 from which we broke down 36% at the start of the year.

With overall trends looking up, we could then see a test of the 2023 high of 186.65, especially if interest rates and inflation come down throughout next year, which could increase spending within the retail space.

Chart displaying JD Sports stock price 2022 to present