View the article online at http://citywire.co.uk/wealth-manager/article/a726079
The Expert View: Tesco, Schroders and Next
by Chris Marshall on Jan 06, 2014 at 05:01
‘Buy’ into a Tesco turn-around
Shareholders can expect more bad news from Tesco (TSCO.L) when it provides an update on Christmas trading this Thursday – but after a rough year things could be looking up for the supermarket giant.
Retail analysts at Jefferies are among a slim majority of City scribblers who say ‘buy’ the shares after four consecutive years of declines.
Tesco, fighting to turn around its fortunes after a profit warning in January 2012, has been losing shoppers. It has invested £1 billion to turn around its UK business.
Though it will have had a ‘challenged’ Christmas, with group sales falling 1.5%, ‘we believe relative trading performance is improving in the UK and international LFL challenges are now past their worst,’ say the Jefferies team.
The market is still assuming the worst: ‘At current valuation levels investors price in the tough UK conditions but assume limited chances of a turn-around domestically or internationally,’ the analysts note.
Tesco shares rose 0.1% to 330p on Friday.
News sponsored by:
Ian McVeigh and Steve Davies, managers of Jupiter's UK Growth fund, talk about their predictions for the UK equity space. Click here to watch a series of sponsored interviews with Jupiter's fund managers on the UK equity market.
Today's top headlines
More about this:
Look up the funds
Look up the shares
- Tesco PLC (TSCO.L)
- Arrow Global Group PLC (ARWA.L)
- Rio Tinto PLC (RIO.L)
- Next PLC (NXT.L)
- Schroders PLC (SDRt.L)
- Hargreaves Lansdown PLC (HRGV.L)
- Aberdeen Asset Management PLC (ADN.L)