AJ Bell reckons that while J Sainsbury (LON:SBRY) continues to make progress, it will take time to turn around, Citywire reports. The comments come after the blue-chip grocer updated the market on its performance yesterday, posting a small rise in second-quarter sales and unveiling plans to close Argos stores.
Sainsbury’s share price surged in the previous session as investors digested the results, gaining 1.64 percent to close at 216.50p and outperforming the broader UK market, with the benchmark FTSE 100 index giving up 1.44 points to end trading 0.02 percent lower at 7,289.99. This morning, the shares have slipped marginally lower, having given up 0.18 percent to 216.10p as of 08:13 BST, as compared with a 0.03-percent fall in the Footsie.
AJ Bell weighs in on Sainsbury’s
Citywire quoted AJ Bell’s Russ Mould as commenting yesterday that Sainsbury’s turnaround was “going to be like a juggernaut, taking a very long time to reposition the business in the right direction”. He further noted that management needed to ensure the business was “running efficiently both in terms of making a profit and customers having a smooth experience when doing their shopping”.
“There is a plan in place; now the hard part is executing it,” the analyst concluded.
Other analysts on supermarket
Nicholas Hyett at Hargreaves Lansdown meanwhile commented that things have been difficult for the blue-chip grocer for a while.
“Sales have failed to inspire, and we think it’s hard to see that changing soon,” he pointed out, adding that “‘tough conditions’ remains the phrase du jour”.
“Sainsbury is doing what it can to boost performance, but there’s still plenty of work to do,” the analyst concluded.
According to MarketBeat, the blue-chip supermarket currently has a consensus ‘hold’ rating, while the average target on the Sainsbury’s share price stands at 231.91p.