Best FTSE 100 Stock of 2019 is Close to Peaking, Analysts Say

(Bloomberg) -- U.K. sneaker seller JD Sports Fashion Plc, the biggest gainer in the FTSE 100 Index in 2019, isn't expected to rise much further in the next year, according to analysts.

The average 12 month price target for the retailer is 772.6 pence, according to a Bloomberg consensus of analyst estimates. That compares with its current price of 762 pence, suggesting a return potential of only about 1%. In 2019, the shares have more than doubled.

“The group is balancing strong sales growth with a resilient margin and this should reassure investors about the future of the company, but we consider the valuation full,” Stifel analyst Eleonora Dani wrote in a note Tuesday. She downgraded her recommendation on the stock to hold from buy, while raising her price target to 780 pence from 680 pence.

Shares of JD Sports have jumped 121% in 2019 after joining the FTSE 100 Index in June as the company benefits from exclusive product ranges and acquisitions of smaller rivals. The year-to-date gain for the retailer is significantly above the next-best performers in the index, with software company Aveva Group Plc up 88% and clothier Next Plc climbing 67%.

Despite today's downgrade, analysts are still overwhelmingly bullish on JD Sports, with 13 having a buy recommendation, according to data compiled by Bloomberg. Two analysts rate the retailer hold while one rates it sell.

To contact the reporter on this story: Lisa Pham in London at lpham14@bloomberg.net

To contact the editors responsible for this story: Beth Mellor at bmellor@bloomberg.net, Jon Menon

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