Home Money SHARE OF THE WEEK: Tesco set for Q1 update

SHARE OF THE WEEK: Tesco set for Q1 update

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SHARE OF THE WEEK: Tesco set for Q1 update

Tesco will be in the spotlight next week and there is plenty of reason to be optimistic.

Britain’s biggest grocer increased its market share to 27.6 per cent last month (up from 27.1 per cent a year ago), while its closest rival, Sainsbury’s, follows with 15 per cent. .

Investors will therefore hope that Tesco’s first quarter update on Friday will further clarify its gap with the rest of the chasing pack.

Analysts at Jefferies expect the supermarket’s retail business in the UK and Ireland to grow 4.3 per cent in the three months to May. This would reflect a slightly weaker performance, after having reported an 8.8 percent increase the previous year.

Last time, Tesco’s total sales reached £14.8bn in the first quarter of last year.

Analysts said another key number to watch is whether Tesco still believes it will have £2bn of free cash flow flowing through the business this year.

They wonder if some of this pile of cash could be returned to investors in the form of a special dividend.

Tesco recently revealed that boss Ken Murphy (pictured) took home a record salary of almost £10m in 2023, more than double the £4.4m he earned the previous year.

A positive update on Friday could provide a much-needed boost to Tesco’s share price, which has gained 6 per cent so far this year.

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