Shares in Tesco (LON:TSCO) have jumped in London in today’s session, ahead of the blue-chip retailer’s third-quarter and Christmas update tomorrow. The supermarket will follow FTSE 100 rivals Morrisons (LON:MRW) and Sainsbury’s (LON:SBRY), which also updated investors on their performance this week.
As of 13:25 GMT, Tesco’s share price had added 1.97 percent to 212.20p. The shares are outperforming the broader market rally which has seen the benchmark FTSE 100 index gain 1.07 percent to 6,934.73 points so far today.
Tesco to post Q3 results
Tesco is scheduled to update investors on its third-quarter and Christmas performance tomorrow and Proactive Investors reports that City analysts expect the company to be the top performer out of the UK’s ‘Big Four,’ with sales growth of 1.5 percent.
“Whilst the overall market has slowed, we remain sanguine on progress in Tesco’s core UK business – the competitive offer is as sharp as it’s been in years and mix benefits […] should drive margin rebuild,” UBS said in a note, as quoted by the newswire, adding that it thinks “Christmas could deliver a positive UK like-for-like surprise vs. market expectations”.
Reuters meanwhile reports that analysts expect Tesco to report UK like-for-like sales growth of between 0.5 percent and one percent for the third quarter to November 24, picking up to between one percent and 1.5 percent for the six weeks to January 5.
The comments come as Kantar Worldpanel revealed yesterday that the FTSE 100 group’s UK grocery sales rose by 0.6 percent, boosted by an extra 125,000 customers, over the 12 weeks to December 30.
Analyst ratings update
Goldman Sachs, which is bullish on Tesco with a ‘buy’ rating, lowered its price target on the shares from 272p to 265p this week, while Barclays remains ‘overweight’ on the blue-chip grocer. According to MarketBeat, Britain’s biggest supermarket currently boasts a consensus ‘buy’ rating and an average price target of 264.43p.