Wm Morrison Supermarkets’ (LON:MRW) special payout to shareholders and expanded relationship with US e-commerce giant Amazon are adding to the group’s already stable performance, Citywire reports. The comments came after the company posted its interims, unveiling a small rise in revenue.
Morrisons’ share price surged in the previous session, gaining 4.69 percent to close at 203.10p, outperforming the broader market, with the benchmark FTSE 100 index inching 6.64 points to close 0.09 percent higher at 7,344.67. This morning, the shares have built on yesterday’s gains, having added 0.54 percent to 204.20p as of 08:17 BST, again outperforming the Footsie which has slipped marginally into the red and currently stands 0.11 percent lower at 7,336.24 points.
HL weighs in on Morrisons
Citywire quoted Hargreaves Lansdown’s analyst Sophie Lund-Yates as commenting yesterday that the deal with Amazon was ‘flattering’ for Morrison and “potentially lucrative to be shoulder-to-shoulder with Amazon as it seeks to expand its online grocery delivery service”. The London-listed supermarket said yesterday that it was expanding its partnership with Amazon Prime Now to more cities across the UK, starting in the third quarter.
She further reckons that the grocer sector was competitive and the FTSE 100 group’s wholesale business was “an important extra strong to its bow”.
Lund-Yates, however, cautioned that while the grocer’s performance has been stable enough of late, “if conditions in the sector were to become materially more difficult, those specials could be taken off the menu”.
Other analysts on grocer
According to MarketBeat, the blue-chip group currently has a consensus ‘hold’ rating, while the average target on the Morrisons share price stands at 242.50p. The 15 analysts offering 12-month price targets for the FTSE 100 supermarket for the Financial Times have a median target of 235.00p, with a high estimate of 255.00p and a low estimate of 180.00p.