This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Trade Parameters
Observations – For
Observations – Against
Last week’s FY 2016 results showed profits at the upper end of guidance thanks to it achieving £1bn of targeted cost savings. The latest KANTAR data showed UK supermarket sales growing at their fastest in 2.5yrs with MRW growing even faster than that market (fastest in 5 years) holding market share versus discounters thanks to its middle market focus and its shop performance boosted by rapid expansion of its internet sales.
Consensus is bearish biased despite the shares in a solid uptrend. If everyone is a seller, who’s left to sell? Potential for upgrades by the 44% of Neutrals to a more positive assessment. The average target price is a whopping 12% below current levels, suggesting reappraisal may be required. Two of the latest broker updates suggest a 260p target, which is beyond our trade objective.
Next Event: Q1 Trading Statement, 4 May; Ex-dividend 25 May
Latest Broker 12-Month Consensus: 6% Buy, 44% Hold, 50% Sell (full breakdown on request)
Source: DowJones Newswires, Reuters News, Bloomberg or Company Press releases
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