Marks & Spencer and easyJet poised for FTSE 100 exit. Time to buy?
Marks & Spencer (LSE: MKS) and easyJet (LSE: EZJ) have just seven trading sessions left to save themselves from being dumped out of the FTSE 100 in the summer quarterly index review. According to my calculations, they’re currently the Footsie’s bottom-ranked constituents, and are set to be pushed out by FTSE 250 firms JD Sports Fashion and Aveva, which both stand poised for automatic promotion to the top index. I see a good business, but a multiple that’s a bit too rich for my liking in the retail sector, and I rate it a ‘hold’. Software group Aveva just missed out on promotion in the last quarterly reshuffle, but its shares have continued to rise and now sit at 3,460p (market cap £5.6bn). I see this as another good business, but on a forward P/E of 36, I maintain my previous view that the sky-high earnings multiple makes it a stock to avoid.