Barclays has named Tesco (LON:TSCO) as one of its 19 top picks, expecting European equities to recoup some of their year-to-date losses into the year-end, WebFG News has reported. The comments came after the latest Kantar Worldpanel numbers showed that Britain’s biggest grocer had continued to grow sales while losing market share in the 12 weeks to November 4.
Tesco’s share price has fallen into the red in today’s session, having given up 0.69 percent to 204.08p as of 09:44 GMT. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.46 percent lower at 6,968.67 points. The group’s shares have added nearly nine percent to their value over the past year, as compared with about a 5.7-percent dip in the Footsie.
Grocer named ‘top pick’
Barclays reiterated its ‘overweight’ stance on Tesco yesterday, with a valuation of 280p on the shares. WebFG News quoted the analysts as saying that they believed that the group’s “core UK business may be performing more strongly than the market share data has suggested,” with the dividend reintroduced and “the possibility of further cash returns” on the horizon.
The analysts further weighed on European stocks, noting that while the uncertainty will not dissipate in a hurry, “a lot does appear to be in the price already,” with Europe trading at near record-low P/E relative to the US.
Other analysts on group
The 14 analysts offering 12-month price targets for Tesco for the Financial Times have a median target of 280.00p on the shares, with a high estimate of 300.00p and a low estimate of 200.00p. As of November 17, the consensus forecast amongst 21 polled investment analysts covering the blue-chip group has it that the company will outperform the market.