Citi ups target for Tesco on sector re-rating
On Wednesday morning analysts at Citi expect Tesco will announce a fiscal year trading profit just below the company-compiled consensus forecast, despite which they have upped their target price on the shares.
Food & Drug Retailers
3,705.02
17:10 19/04/24
FTSE 100
7,895.85
16:59 19/04/24
FTSE 350
4,341.08
17:09 19/04/24
FTSE All-Share
4,296.41
17:08 19/04/24
Tesco
281.40p
16:59 19/04/24
The full-year trading profit is forecast to come in at 1,395m pounds, in comparison to the company-compiled consensus of 1,401m pounds.
Net 'retail' operating cash flows are expected to drop almost 50% from last year´s level to reach 1,840m pounds. However, free cash flow is anticipated to be negative to the tune of 300m pounds.
Net debt is forecast to end the year at 8.1bn pounds, alongside a pension deficit of 4.5bn pounds.
Nevertheless, the broker lifted its price target on the stock to 235p from 190p “to reflect sector re-rating, trading improvement in the UK.”
The recommendation on the shares was kept at neutral.