Marks & Spencer is a buy for the contrarian investor

As Marks & Spencer's report a decline in profits Helal Miah, investment research analyst at The Share Centre, explains why it remains a buy for contrarian investors.
 
"Marks & Spencer reported a fall in full year profits this morning as legacy issues and difficult trading conditions have seen its general merchandise operation suffer. However, on a positive note investors will be pleased to see its food and international operations continued to perform well. Although it failed to offset the drag from general merchandise, like-for-like food sales rose by 1.7%.
 
"We continue to believe Marks & Spencer is tackling the problems in its womenswear and general merchandise operations. The changes to the board and the actions they are taking are being implemented but investors should be aware it will take some time to bed in. The share price has shown some strong gains in recent months on the back of anticipated future improvements and rumours around a potential takeover.
 
"For those investors who can see past some of these economic difficulties and take a contrarian view on cyclical stocks we continue to recommend Marks & Spencer as a ‘buy'. We believe there are positive changes to come from the group. It continues to look at ways to reduce costs whilst remaining competitive in these challenging conditions and expand its overseas operation, which should help balance its reliance on the UK consumer over time."