Tesco (#TSCO) – H1 adj. EPS +18%, DPS +67%, argues “well-positioned”
- 2018-10-03 06:56:04
UK 01:28 Monday, 5 October 2026
Breaking news and expert analysis on fast-moving AIM and LSE listed shares
So how does it all look for Tesco (TSCO) and ITV (ITV) the morning after the night before? Back on Sunday I highlighted my concern about some upcoming strategy updates from these two FTSE-100 names. So what did they say during their investor updates yesterday...and what am I thinking now?
Sunday morning newspaper perusal highlighted two stories on names I loved up on these pages in months and years past. The first is ITV (ITV) which I have considered as a buy for a while now due to the combination of cheapish metrics and the value of its growing content business as detailed here.
Time for a food retail update. I was slightly surprised by the purchasing hookup between Tesco (TSCO) and the French-listed behemoth Carrefour which was announced on Monday. You all know how loved-up i have been with Tesco over the last little while and - reciprocating my passion - the shares have popped above 240p big technical resistance level in recent weeks as I had hoped (and mused upon here ). Anyhow, Monday's announcement is no sector ball-breaker but rather part of a search for marginal gains.
Well I called it. Back in January I told you that opportunity was better than the threats to the Tesco (TSCO) business model and I urged you to buy the stock, which is now trading at the 220p+ level I hoped for in my write-up.
It was only yesterday on this site that I wrote: 'One of the hardest things for less experienced stock market participants to get their heads around is the expectations game. Numbers can be good (or bad) but if the teenage scribbler analyst, ‘professional’ fund managers and ‘the great unwashed’ in the form of other market participants broadly already think something, then confirmation of this event is not going to really change the share price needle. Of course as a consequence companies then start to try to become clever in managing expectations in order to 'beat' anticipated numbers...but that's for another time'. It is clear that Tesco (TSCO) either did not get the message or the animal spirits of those teenage scribbler analysts got the better of them…
Tesco (TSCO) shares are little changed today and progress or not over the next few weeks will be highly dependent on the infamous Christmas trading update of early January. I have no great tactical insights on this but I am hopeful it will be part of the strategic improvement and opportunity in the stock I noted a couple of months or so ago HERE. Certainly the share has shown a bit of form recently and this has been driven by improving sales metrics, hopes for the generation of enhanced margin and cashflows, lower debt...and the potential from the Booker (BOK) takeover. It is the latter which is in the news today.
Imagine the scene, if you will, on the trading desks of a professional investment house after Tesco (TSCO) just puckered up its interim results. Another quarter of like-for-like sales growth, free cash flow generation chivving down the debt burden, margin targets for later in the decade reiterated and - stone the crows! - the interim divvy is back. Fingers would be tapping away sending little messages to your favoured clients or internal portfolio managers. You can imagine what is written: “Tesco’s is back!”, one message might read. Another would undoubtedly exhort the reader to buy the stock.
Hello, Share Crackers. It happens nine times out of ten. A company announces much bigger profits in its half term results - and the share price crumbles. But no need for alarm, as the price usually recovers to strike north again within a few days. An enticing buying opportunity then? Which bring me to today’s tip.
Hello Share Crunchers. We have a little saying in our family. ‘There’s always something…’ Meaning, however well things seem to be going, there is invariably a major snag to contend with.
