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Share Name Share Symbol Market Type Share ISIN Share Description
Sainsbury LSE:SBRY London Ordinary Share GB00B019KW72 ORD 28 4/7P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -0.80p -0.33% 242.40p 242.10p 242.40p 243.90p 241.00p 242.60p 5,538,216 16:35:20
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Food & Drug Retailers 23,506.0 548.0 23.9 10.1 4,667.68

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DateSubject
25/8/2016
09:20
Sainsbury Daily Update: Sainsbury is listed in the Food & Drug Retailers sector of the London Stock Exchange with ticker SBRY. The last closing price for Sainsbury was 243.20p.
Sainsbury has a 4 week average price of 233.28p and a 12 week average price of 233.03p.
The 1 year high share price is 294.40p while the 1 year low share price is currently 211.50p.
There are currently 1,925,610,877 shares in issue and the average daily traded volume is 7,512,283 shares. The market capitalisation of Sainsbury is £4,667,680,765.85.
09/8/2016
08:56
chris coxon: Michael Allen, equity specialist- 'At the time of writing the share price is 223.7p and given the risks, I foresee the shares drifting lower. Near-term targets are seen at 214.7p, 205.8p and 192.4p, while traders might consider short-selling the shares with a stop-loss at 232.5p' Bloody good advice old chap!!
04/8/2016
09:56
imperial3: Being a Home shareholder,I have to ask myself should I accept Sainsburys shares or opt entirely for cash.Now,if they can hold the dividend the yield is not bad.On the other hand this is such a competitive sector,the future can hardly be called rosey.Is there more upside potential than downside currently for the share price? Any views?
30/7/2016
10:11
loganair: By Michael Allen, equity specialist - Sterling has fallen circa 13% against the dollar since Brexit, yet the top 100 companies attract 70% of sales/profits from outside the UK and 50% from outside Europe, so a weaker pound should equate to higher earnings per share for UK plc’s. Those firms, however, that generate the majority of their revenues in sterling will not reap the same benefits from a weak domestic currency. Supermarket giant, Sainsbury’s, Britain’s biggest non-food retailer, generates circa 70% of revenues in sterling and could be more exposed should discretionary consumer spending be impacted by the uncertainty. Results on 8th June revealed Sainsbury’s sales have gone back into decline after it reported a 0.8% fall in like-for-like sales for the first quarter to 4th June and the company warned of challenging times ahead. The UK retail sector has fundamentally changed over the past decade, with discounters such as Aldi and Lidl gaining market share, while the expansion of pound stores and food price deflation have also squeezed profit margins at the big supermarkets. Furthermore, Asda, the UK’s most profitable retailer, is rumoured to be preparing a major price repositioning, which could seriously damage sector profits. Many also question Sainsbury’s £1.4 billion acquisition of Home Retail Group, the owner of Argos and Habitat, which is expected to complete in August 2016. Over 72% of the company’s revenue is generated in sterling and many of their goods are imported, while Argos is also going through a multi-million pound makeover in another attempt to compete with the likes of Amazon. Sainsbury’s trade on 10x earnings and growth is expected to fall by 6% in 2016 and 10% in 2017, although these figures could be accentuated by a weak pound. The debt pile of £1.6 billion is also due to rise to over £2 billion after the Home Retail Group acquisition, giving it a high gearing compared with a market value of £4.3 billion. Life is hard enough for Sainsbury’s, but the impact of Brexit, a weak domestic currency, a dangerous acquisition of Home Retail Group and an Asda-led price war will further impact the business, which could result in dividend cuts and perhaps the need to ask shareholders for additional capital. At the time of writing the share price is 223.7p and given the risks, I foresee the shares drifting lower. Near-term targets are seen at 214.7p, 205.8p and 192.4p, while traders might consider short-selling the shares with a stop-loss at 232.5p.
22/7/2016
08:17
christh: The share price must be adjusted and re-rated as it has added more assets. The revenue re-adjusted along with the profits. It should be over 350p now. SBRY will be taking over Argos this autumn so in time for Xmas. Great opportunity to Buy now.
19/4/2016
09:58
loganair: By Andrea Felsted and Chris Hughes: Sainsbury's £1.4 billion($2 billion) bid for Argos now looks like an accidental poison pill. A consortium involving the Qatar Investment Authority, which is Sainsbury's biggest shareholder, private equity group CVC and Canadian property giant Brookfield considered bidding for Sainsbury late last year, according to Sky News. The group reportedly abandoned the plan shortly after Sainsbury's surprise approach for the struggling online and catalog business was revealed in January. Some Sainsbury investors already had reservations about buying Argos, and the idea that the adventure may have cost them a juicy takeover premium will be galling. But while adding Argos does change the dynamics of a potential leveraged buyout of Sainsbury, it does not kill the logic entirely. Taste the Difference: The increase in Sainsbury's share price has made it a pricier purchase for a potential bidder. For starters, Argos is not such a big deal as to make Sainsbury too big to swallow. Adjust for the cash going out from Sainsbury to Argos shareholders under the terms of the transaction, and the combination would have a market capitalization of about £6.1 billion. Adding a standard 30 percent takeover premium would bump this up to £8 billion. Had any bidder made an approach in mid-December, it would have had to offer £6.7 billion, on the same premium. That's not a massive gap to bridge for such financially strong buyers. Moreover, QIA already has a big stake in Sainsbury, about 22 percent post-Argos. Exclude this, and the check to be written to buy the rest falls to £6.2 billion. Bidders' check could be about £6.2 billion. Secondly, owning Argos may ultimately help add leverage. The net debt position of a Sainsbury/Argos combination is expected to broadly stay the same, at about £1.5 billion. But the group gains some new sources of income to fund extra debt. Sainsbury's Ebitda is running at about £1.2 billion, Argos would bring about £80 million. Plus there are the combination's savings and revenue gains forecast to hit £160 million within three years. Gearing up to, say, 2 times Ebitda would add about £1.4 billion of extra debt capacity. That would both reduce the consortium's equity contribution and boost returns. The group could carve out a separate property subsidiary which would be the ideal vehicle for taking on the debt, thanks to its attractive collateral. So a bid for Sainsbury-Argos is doable in theory. No Quick Fix: It will take three years for Sainsbury to realise the full synergies from buying Argos. There are two big snags, and the first is the timing. In the short term, Argos is going to be more costly than profitable: Sainsbury has warned of a near-term hit from £270 million in integration costs and capital expenditure before the gains come through. The second is the family. In 2007, the last time the grocer was the subject of private equity interest, the Sainsbury family was unwilling to see the company loaded with more debt. The company's pension obligations were also a stumbling block. It looks like the scuppering of the consortium bid was accidental. Even if Sainsbury realized toward the end of 2015 that it needed a change of strategy to defend itself against continued pressure from aggressive discounters and tackle its languishing share price, it's hard to see that willingly making itself less attractive to the group of bidders was an intended consequence. But it ratchets up pressure on Sainsbury Chief Executive Mike Coupe to deliver on his masterplan to turn Sainsbury into a non-food powerhouse to challenge Amazon's creep into Britain and John Lewis, and mop up excess space in Sainsbury's stores at the same time. If Coupe had to make his bold Argos escapade work before, he really needs to now. His hurdle for success just got higher.
09/3/2016
13:52
careful: what a load of old tosh. how can you analyse the SBRY share price with so many short positions open. over 10% on loan. i do not understand the logic of the shorters here. short at 400p ok that makes sense. ..but short at 270p is crazy. there must be better targets.
20/2/2016
12:09
kompressor: but this is all about the share price. if they raise the offer and share price falls, the value of the bid falls too. it does not make any sense to raise the offer. if sainsburys shares rise to 296p, that values Home at 175p. so mike coupe needs to convince Home shareholders that Sainsburys shares are worth at least 300p. that is not difficult given the £11bn property. sainsburys at 400p would put Home at 208.4p so i suspect many Home shareholders would still prefer the sainsburys offer.
02/2/2016
08:05
edmundshaw: Deal is worth over 160p even if you assume Sainsburys share price was fair at 240p. What? So Coupe accepts 240p as the new normal for SBRY share price? While accepting that 100p was a vastly depressed share price for HOME? Seems that "We will not overpay" is director code for "we are prepared to overpay substantially and screw out own shareholders". Must remember that for future reference :-(
19/11/2015
19:40
loganair: Time to go shopping for Sainsbury’s? By Robert Sutherland Smith: Sainsbury at 253p after the interim results. The traditional quoted food retail sector is still undergoing a big change on an undetermined time scale. On that basis, Sainsbury shares may not look an obvious buy. However, I argue that the shares are attractive when the financial fundamentals are recognised. The shares, after the results of the first half of the current year, are priced at 253p and look pretty bombed out on those fundamentals. Our home grown food retailers (who of course sell more than food) have been in the grip of an insurmountable problem: losing market share to outside competitors who have been increasing their market share. Nothing can be more debilitating for a big business than the loss of scale and economic and financial benefits that come with scale of operations, whilst the competitive interlopers (in this case Lidl and Aldi, the Hengist and Horsa of UK retailing) are increasing and improving theirs. That is a bit like their fighting with one arm tied behind their back. The big question is how long it will take before the now more competitive sector settles down into a new equilibrium. No one knows and it is difficult to guess. Moreover, there are other threats to the current sector players – including the invaders. As our legacy retailers of staple products spot ‘on line’ shopping as a lower cost opportunity, internet operators like Amazon spot ‘on line’ sales of food stuff as a new market opportunity. We are clearly only part way through some pretty momentous changes in this sector; none of which are susceptible to clear visibility and easy prediction and certainly not credible forecasting. However, as always, there is the usual solution of some future consolidation amongst the retreating traditional players like Sainsbury, Tesco, Morrison and Waitrose etc. I suspect that will become a genuine prospect in due course, particularly if Amazon come into the food retailing business – taking even more British Exchequer tax revenue to other taxation jurisdictions no doubt. So, is there a case for buying UK food retailers and Sainsbury in particular? The elementary factors guiding us in answering such a question, include the following: that all companies in their activities are subject to degrees of uncertainty; share prices over time move to discount evolving news, facts and prospects; long term investors with wealth to preserve and hopefully grow, need a spread of investments and risk. That includes food retail shares of course. Coming to Sainsbury specifically, the best argument for investing money in it in comparison with other retail shares is that the share price is now discounting the difficulties. The share price last seen was 253p after the last interim results. About two years ago, the share price was over 400p. What does an investor now get for his or her money? First, a lot of sales revenue; on the basis of last year’s sales annual revenue at £23.5 billion on an equity capitalisation of £4.8 billion; put another way a share price of 253p buying historic sales revenue of an estimated 1,237p per share. Second, a very low price to book valuation. In fact the share price last seen stands at a 13% discount to balance sheet net assets in March. The market capitalisation of Sainsbury equity, currently standing at a value of £4.8 billion, commands an enterprise value which is three and a half times larger. In the balance sheet of 14th March last, total assets were stated as £16.5 billion. Also note that last year’s EBITD (basically profits before interest, taxation and depreciation are charged) amounted to £770 million putting Sainsbury shares on an EBITDA ratio of only 6.2 times on the basis of last year’s figures. Despite the gearing, interest costs were reportedly covered 6 times on an annual basis and 7.4 times on an interim basis. The shares price also stands at only 3.7 times last year’s annual cash and near cash held. Such valuations are strikingly low. Turning to the latest interim results, the disappointing news include the facts that the interim dividend was cut 20%; that there was a loss of market share and thinner margins; that sales fell 2%; and that underlying profits fell by 18%. The company is responding, we are told, by improving its own branded ‘taste the difference’ products, which, against the 2% fall in sales, actually grew by a reported 2% in volume terms. However, the incoming new CEO Mike Coupe talks of cutting costs according to a programme that seems ahead of schedule. The company is also increasing its convenience stores (very much the fashion in the sector) where sales have risen by a reported 11%, on the back of a one fifth increase in the number of such stores. Moreover, the retailer is developing its new Tu clothing offer – sales up 10% over the first half – as well as building its Sainsbury banking operation which is for the moment absorbing transformation cost. At a given point the bank should obviously be making a contribution to net profits. The market is estimating a 17% fall in earnings this year to earnings per share about 22p, putting the shares on a forward estimated price to earnings ratio of just over 11 times. The consensus estimate, at this juncture, is for a further 2% decline in earnings the year after that. Interestingly, it forecasts top line sales revenue for this year as being static at £23.75 billion and pretty close to that again in the following year at an estimated sales revenue figure of £23.52 million. In essence then, the market seems to be calculating that Sainsbury will hold its sales, with a well understood fall in earnings this year but holding on to most of those earnings the following year. The market consensus also estimates that the annual dividend will be reduced twenty per cent in line with the cut in the interim dividend. At the 10.5p dividend payout estimated for this year and next year the estimated annual dividend yield for this year and next is 4.4% p.a. As I always say on such occasions, I am no more gifted in seeing the future than the rest of humanity. However, as a compensation for that lack of prophetic vision, I can identify value in the here and now. Sainsbury at this level shows quite a lot of what we call fundamental value, as indicated above. With the share price at a discount to balance sheet net assets, investors now are arguably being asked to pay nothing for earnings. It will be interesting to see whether at this stage and at these levels of valuation, the bears will be tempted to fold up their short positions together with their tents. Sainsbury is reported to have been one of the most shorted shares in the market. Technically, the shares have been moving sideways for over a year in a trading range of roughly between 220p and 290p. Arguably, the share price looks as though it might have broken out of the earlier downtrend that took it into that range. Have a look and see if that is your interpretation.
21/6/2015
17:31
loganair: Why I Won't Be Buying Shares In J Sainsbury By John Kingham: J Sainsbury along with the other major supermarkets, has been through the wars in recent years. Most people know the story by now, if only because of the more severe and highly publicised problems at Tesco. J Sainsbury: It's a supermarket Here's my extremely short version of the backstory for J Sainsbury. The big four UK supermarkets (Tesco, WM Morrison, J Sainsbury and, to a lesser extent, ASDA) had it fairly easy. As long as they did a half decent job, millions of shoppers would continue to shop with them. But then along came the Financial Crisis and the Great Recession, and shoppers had far fewer pennies to spare and more time on their hands to shop around. The result was a change of shopping habits to more frequent and smaller shopping trips, at local stores that focus on price more than anything else. That played right into the hands of discounters Aldi and Lidl, who fitted this new shopping behaviour like a glove. The initial response from the big supermarkets was to ignore the discounters, but that was a massive mistake and the big four have been losing market share and struggling to adapt quickly enough ever since. A highly successful company, until recently: things had been going very well. The company has a long and unbroken record of dividend payments and, in recent years, revenues, profits and dividends had all been going strongly. Its statistics for the last 10 years look like this: •Growth Rate (covering revenues, profits, dividends) of 6.4%, well ahead of the FTSE 100's anaemic 0.8% •Growth Quality (frequency of revenue/profit/dividend increases) of 75%, also ahead of the FTSE 100's mediocre 50% •Net ROCE (median over 10 years, net of interest and tax) of 5.4%, below the large company median of 10% So J Sainsbury has grown fairly quickly and smoothly over the last decade, including the profit and dividend decline in the 2015 results. However, its profitability as measured by Net ROCE (Return on Capital Employed) is weak. Because I use post-interest and tax profits as the "return" part of ROCE, this low profitability figure could be because Sainsbury's core business isn't very profitable, or because the company has lots of debt (and hence large interest payments) or other non-operational expenses, or both. In fact, Sainsbury's profitability is so low that it effectively rules the company out as an investment for me. I currently use the following rule of thumb: Only invest in a company if its 10-year median Net ROCE is above 7% J Sainsbury fails that test, so that's the first reason I would be buying the company's shares. But there are other reasons too. Its financial obligations are too large for my liking One of the reasons for Sainsbury's weak profitability is its large debt obligations. It has £2.8bn of total interest-bearing debts as at the 2015 annual results. That sounds like a lot and it is, especially as the company has "only" earned an average of £0.5bn in post-tax profits over the last 5 years. Another large financial obligation is its defined benefit pension scheme. Because the company must ensure that its pension fund assets exceed the fund's liabilities, it must pour cash into its pension fund if there is a deficit. And that's exactly what it's doing today. The pension fund obligations stand at £7.7bn, while the pension deficit is £0.7bn. That deficit must be closed, and the company has agreed to pay £49m into the scheme each year until 2020, which currently amounts to almost 10% of the company's post-tax profit. And so for J Sainsbury we have: •Debt Ratio (ratio of total borrowings to 5-year average post-tax profit) of 5.2 •Pension Ratio (ratio of pension obligations to 5-year average post-tax profit) of 14.4 •Combined Debt and Pension Ratio of 19.6 Unfortunately, those ratios break some of my other rules of thumb: •Only invest in a defensive sector company if its Debt Ratio is below 5 •Only invest in a company if its Pension Ratio is below 10 •Only invest in a company if its Combined Debt and Pension Ratio is below 10 So along with "too low" profitability, J Sainsbury also has "too high" financial obligations for me. As a result, I won't be buying the company's shares anytime soon, no matter what the price. The shares are attractively valued, if you ignore the other problems Even though I wouldn't consider buying the company's shares at the moment, I'm crunching through the accounts anyway so I might as well take a look at what share price might be considered "fair value" given its financial history. The caveat here is that this fair value would only apply if the company wasn't breaking any of my rules of thumb, but it's still an interesting value to calculate. As J Sainsbury has a slightly above average record of growth, its shares, according to my valuation system, deserve a slightly above average rating. With its shares currently at 261p, the company's valuation multiples look like this (compared to the FTSE 100 at 6,700): •PE10 (price to 10-year average EPS) of 10.9, which is lower than (better than) the FTSE 100's 14.0 •PD10 (price to 10-year average dividend per share) of 18.5, which is lower than (better than) the FTSE 100's 32.9 •Dividend yield of 5.0%, higher and better than the FTSE 100's 3.5% So in terms of valuation, J Sainsbury is significantly more attractively valued than the FTSE 100. Its share price is cheaper than average, relative to past earnings and dividends, and the dividend income yield is above average. And remember, the company also has a better track record of growth than average, so if anything it should be on higher valuation multiples than the index (ignoring its various problems, of course). To calculate fair value for the company's shares, I can adjust its share price until it has a middling rank on my stock screen. At its current 261p, J Sainsbury has a rank of 47 out of 230 companies on the screen, so it is one of the most attractively valued (again, ignoring its problems). For the shares to be "fairly valued," they would have to increase to 450p, which is some 72% above their current share price. At that level, the shares would have a historic dividend yield of 2.9%, which I think would be reasonable as long as the company's successful past could be replicated in future. However, the company's profitability is too low for me, and its financial obligations are too large, so I won't be investing at the moment. Note: Last time I looked at J Sainsbury's shares, I was much more upbeat. However, since then (May 2014), I have become more cautious about both profitability and financial obligations (partly as a result of the problems with Tesco and Morrisons), so under my now much stricter system, the company has gone from a buy to uninvestible.

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