Shares in Wm Morrison Supermarkets (LON:MRW) have lost ground in today’s session, ahead of the blue-chip grocer’s first-quarter results tomorrow. The update will come at a sensitive time for the UK grocery market, following Tesco’s (LON:TSCO) merger with Booker Group and a looming tie-up between Sainsbury’s (LON:SBRY) and Walmart’s Asda.
As of 14:16 BST, Morrisons’ share price had lost 1.21 percent to 243.90p, underperforming the benchmark FTSE 100 index which has climbed into positive territory and is currently 0.48 percent up at 7,602.21 points. The grocer’s shares have added more than one percent to their value over the past year, as compared with about a 3.5-percent gain in the Footsie.
Morrisons to post Q1 results
Morrisons is scheduled to post its first-quarter results tomorrow and City A.M. reports that analysts at Barclays forecast sales growth of 1.7 percent, below the grocer’s figures for the fourth quarter of 2017, and potentially marking the group’s lowest sales growth since the end of 2016.
The newswire also quoted Russ Mould, investment director at AJ Bell, as commenting that “the blue-chip grocer faced “fresh strategic challenges, in the form of the Tesco-Booker deal and the proposed Sainsbury's-Asda merger – all of this on top of the day job of fighting off the discounters, Aldi and Lidl”.
The results will follow the latest Kantar Worldpanel data which showed last week that Morrisons was the fastest-growing traditional supermarket in the 12 weeks to April 22, raking in sales growth of 2.2 percent and holding its market share at 10.5 percent.
Analysts on blue-chip grocer
The 13 analysts offering 12-month price targets for Morrisons for the Financial Times have a median target of 235.00p on the shares, with a high estimate of 265.00p and a low estimate of 170.00p. As of May 4, the consensus forecast amongst 19 polled investment analysts covering the FTSE 100 supermarket advises investors to hold their position in the company.