Wm Morrison Supermarkets (LON:MRW) is expected to post a rise in revenue and earnings when it updates investors on its interim performance on Thursday. The results will follow an update from Primark owner Associated British Foods (LON:ABF) earlier in the week.
Morrisons’ share price has surged in London this Friday, having gained 1.05 percent to 188.15p as of 13:51 BST, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.05 percent higher at 7,275.09 points. The grocer’s shares have given up more than 26 percent of their value over the past year, as compared with less than a one-percent fall in the Footsie.
Interim results preview
Morrisons is scheduled to post its half-year results on Thursday and IG reports that earnings per share are expected to come in at 6.4p, up 2.6 percent year-on-year, while the grocer’s revenue is expected to have climbed £8.9 billion.
“For supermarkets, Brexit hangs over everything. The UK economy could be in a very different place come 1 November, both in a good way and a bad way, or indeed it could also be in exactly the same place. This makes it very difficult for supermarkets to plan ahead,” IG’s chief market analyst Chris Beauchamp commented in a note this week, adding that “a weaker pound will continue to put pressure on earnings”.
Proactive Investors meanwhile reports that UBS has trimmed its like-for-like sales estimates for Morrisons following what it has described as a ‘slower summer’ compared to last year when hot weather and the World Cup boosted results. The broker, however, expects margins to pick up slightly in the second half of the year, helped by various cost savings and better wholesale economics.
Analyst ratings update
The 15 analysts offering 12-month targets for the Morrisons share price for the Financial Times have a median target of 235.00p, with a high estimate of 265.00p and a low estimate of 180.00p. As of August 30, the consensus forecast amongst 22 polled investment analysts covering the blue-chip supermarket advises investors to hold their position in the company.