Tesco share price: New CEO pledges to revive company

on Sep 2, 2014
Updated: Oct 17, 2019
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iNVEZZ.com, Wednesday, September 2: Tesco’s (LON:TSCO) new CEO, Dave Lewis, has pledged to return the beleaguered supermarket to being “the customers’ champion”, while highlighting its loss of market share in the UK as its most urgent problem.

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Lewis took the reins at Tesco yesterday, assuming the role a month earlier than planned, after the UK’s largest retailer warned on Friday that profits for the year would be lower than expected and slashed its dividend payout to investors (https://invezz.com/news/equities/12971-tesco-share-price-plunges-on-shock-profit-warning Tesco share price plunges on shock profit warning).

On his first day at the helm, Lewis sent a rallying message to staff outlining his initial plans for the grocer. He introduced himself to Tesco’s more than half a million employees, telling them he would be doing “a lot of listening” to staff, customers, shareholders and investment analysts.
In the letter, reproduced by the Grocer, Lewis also promised to restore Tesco as “the customers’ champion”. The former Unilever executive said he would not be hustled into making any “hasty decisions” about how to revive the struggling retail giant, but remarked that Tesco’s loss of market share in the UK needed to be addressed “with urgency”.

Tesco has been slow to respond in the supermarket price war and has been losing market share to Aldi and Lidl, the German hard discounters. According to Kantar Worldpanel’s latest data, Tesco’s sales fell four percent year-on-year in the 12 weeks to August 17, while its market share declined to 28.8 percent, from 30.2 percent a year earlier (https://invezz.com/news/equities/12927-tesco-loses-market-share-as-shoppers-flock-to-discounters Tesco loses market share as shoppers flock to discounters).

“You will know only too well that it has not been an easy time for our business. The retail market in all countries where we operate has become extremely tough, and is changing faster than ever. We are losing market share in our largest market and we need to address this with urgency,” Lewis said in his letter yesterday. “The most important thing is that we all focus on being on top of our game. We need to keep it simple and customer-focused,” he added.

**Tesco share price**
Lewis’s reign at Tesco got off to a lacklustre start with the company’s shares among the biggest fallers in the FTSE 100 as investors digested a report over the weekend which revealed that one of Tesco’s major shareholders, Harris Associates, had cut its stake from three percent to one percent (https://invezz.com/news/equities/13000-tesco-share-price-major-investor-trims-stake Tesco share price: Major investor trims stake).
More than £1.3 billion was wiped off Tesco’s market value on Friday after its shares fell to 230p, their lowest level in 11 years. Yesterday they closed down again, off nearly two percent at 225.55p.
Today the stock has recovered slightly, trading 0.64 percent higher at 227.00p as of 08:30 BST.
Of the 18 analysts projecting 12 month price targets for the FTSE 100-listed supermarket group for the Financial Times, the median target is 267.50p, with a high estimate of 360.00p and a low estimate of 195.00p.
According to the FT, as of August 29, 2014, the consensus forecast amongst 42 polled investment analysts covering Tesco advises investors to hold their position in the company.
**As of 08:30 BST, buy Tesco shares at 227.05p.**
**As of 08:30 BST, sell Tesco shares at 226.95p.**

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