Ocado share price gains ground ahead of half-year update

Numis forecasts EBITDA of £43.5 million

Ocado share price gains ground ahead of half-year update

Shares in Ocado (LON:OCDO) this morning, ahead of online grocer’s half-year results due out tomorrow. The update will come after the company recently joined the FTSE 100 index following a distribution deal with US grocer Kroger, which fuelled demand for the shares.

As of 09:31 BST, Ocado’s share price had added 0.94 percent to 1,023.50p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.14 percent higher at 7,628.53 points. The group’s shares have added more than 260 percent to their value over the past year.

Ocado to post HY results

Ocado is set to report its half-year results tomorrow and The Times reports that Numis forecasts earnings before interest, taxes, depreciation and amortisation of £43.5 million. IG’s market analyst Chris Beauchamp meanwhile notes that the online grocer is expected to report a 12.5-percent rise in to £803 million.

“The recent surge in the stock has been driven by the firm’s success in reinventing itself as a technology firm that can provide its expertise to others, a move exemplified by the recent deal with US giant, Kroger,” the analyst pointed out, adding that analysts at Bernstein estimate that the grocery e-commerce market will be worth $162 billion by 2025, while Goldman Sachs expects that the global revenue pool which Ocado can address to be worth around $250 billion. 

Analyst ratings update

The 16 analysts offering 12-month price targets for Ocado for the Financial Times have a median target of 775.00p on the shares, with a high estimate of 1,700.00p and a low estimate of 265.00p. As of July 6, the consensus forecast amongst 18 polled investment analysts covering the blue-chip group advises investors to hold their position in the company. 

As of 10:06 BST, Monday, 09 July, Ocado Group PLC share price is 1,027.50p.

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