Sainsbury (j) Investors - SBRY

Sainsbury (j) Investors - SBRY

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Stock Name Stock Symbol Market Stock Type Stock ISIN Stock Description
Sainsbury (j) Plc SBRY London Ordinary Share GB00B019KW72 ORD 28 4/7P
  Price Change Price Change % Stock Price Last Trade
6.80 3.05% 229.70 16:35:07
Open Price Low Price High Price Close Price Previous Close
222.60 222.30 232.10 229.70 222.90
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spob: " making life more difficult for the investor class working hardest to keep markets honest " HaHaHa... don't make me laugh
spob: Hedge funds feel the heat as Pearson catches day-trader fever Bearish bets unwound as US exuberance crosses the Atlantic Bryce Elder Lombard Financial Times 27 January 2021 Https:// It is a measure of dysfunctional markets that day traders delivered a bigger return for Pearson shareholders within 90 minutes than John Fallon ever managed in seven years as chief executive. An early morning pile-on lifted shares of the textbook publisher by nearly 20 per cent to their highest since July 2019. Had the long-rumoured private equity bid approach finally arrived? It appears not. Instead, Pearson was one of a handful of companies to catch the secondary effects of stonk-mania, the US-led fashion among retail investors for using collective brute force to soak up liquidity and pressure short-sellers into closing their bets. Cineworld and Petrofac caught the same bug, as did J Sainsbury. A cinema chain, a refinery engineer and a grocer have little in common other than being among the most heavily shorted stocks on the London market, with Financial Conduct Authority data showing 8 per cent or more of their total share capital out on loan. It is too easy, however, to write off these moves as a direct consequence of investment gamification via internet message boards and commission-free trading apps. Stock markets remain a niche pursuit for Britons, who have free access to many other forms of legal gambling, and the social media chatter on Wednesday gives no hint of a cross-border mob assembling that would have the heft to move FTSE 100 stocks. Yet more than 6m Pearson shares changed hands within the first three hours, about treble the daily average. Instead, events on Wall Street appear to have triggered a broad and undifferentiated risk-off trade among hedge funds. Very few will have direct exposure to the likes of GameStop, a flagship investment for the day trader armies. But after Melvin Capital Management required a bailout for being on the wrong side of the GameStop trade, fellow hedge funds are facing higher borrowing costs and more constraining volatility metrics. Do not expect much sympathy for the short-sellers. They make convenient villains, particularly on the internet forums that set the current mood. Yet in a market powered largely by algorithms and technical signals, the bears play a valuable role in improving corporate transparency and accountability. Financial incentives have helped expose numerous frauds, from Enron and Wirecard to NMC Health, as well as putting pressure on countless other companies to clean up their operations. It is hard to know exactly how much credit to give the amateur trader armies for each day’s gyrations. Nevertheless, their involvement is making life more difficult for the investor class working hardest to keep markets honest, which is an unfortunate unintended consequence.
spob: ‘Short squeeze’ spreads as day traders hunt next GameStop White House is ‘monitoring the situation’ after surge in targeted stocks on both sides of the Atlantic European companies targeted by Reddit traders include Poland’s CD Projekt, maker of the Witcher series of video games, the pharmaceuticals group Evotec and the battery maker Varta Robert Smith, Laurence Fletcher and Madison Darbyshire in London and Eric Platt in New York Https:// Financial Times 27 January 2021 A “short squeeze” that started on Wall Street swept across the globe on Wednesday, triggering another day of frenetic moves in the share prices of companies with large bets levied against them. The White House press secretary Jen Psaki said the Biden administration was “monitoring the situation” as shares of companies including GameStop, the hard-hit cinema owner AMC and BlackBerry surged in a volatile day of trading. The dramatic moves highlight the growing influence of retail traders, who have organised on the message board site Reddit. The group has focused on pushing up stocks that are the subject of large short bets by hedge funds. Their success in rallying the stock price of GameStop has vindicated a group now targeting companies on both sides of the Atlantic. Stocks such as US home goods retailer Bed Bath & Beyond, Finnish telecoms group Nokia, German pharmaceuticals company Evotec, former Financial Times owner Pearson and Polish games developer CD Projekt rose sharply in intraday trading. Shares in AMC, which earlier this week clinched a rescue financing, rose 301 per cent on Wednesday, while the retailer Express more than tripled in value. GameStop, which has been at the centre of the retail trading bonanza, shot up 135 per cent. We are recently detecting some European stocks being touted as 'the next GameStop’ among retail investors Ivan Cosovic, Breakout Point The gains stood in stark contrast to a broad market decline triggered by concerns about the rollout of vaccines and pandemic risks to the economy. The US S&P 500 index and tech-heavy Nasdaq Composite both slid 2.6 per cent. “It’s like a wolf pack seeking out the weakest member of the herd,” said Steve Sosnick, chief strategist for Interactive Brokers. The flash rallies prompted TD Ameritrade to put trading restrictions in place for several securities, including GameStop and AMC. The company said the limits could include restricting short sales or requiring 100 per cent margin for certain trades, moves it said would mitigate risks for itself and its clients. “We made these decisions out of an abundance of caution amid unprecedented market conditions and other factors,” the brokerage said. The Securities and Exchange Commission on Wednesday said it was aware of the volatility across equity and options markets and it was “working with our fellow regulators to assess the situation and review the activities of regulated entities, financial intermediaries, and other market participants”. William Galvin, the Massachusetts secretary of the commonwealth who last month sued the trading platform Robinhood for “gamifying” investing and failing to protect its users, said trading in GameStop should be halted. “At the present time, the best action is to prevent this from being traded,” he told the Financial Times. (Robinhood has denied the allegations in the complaint from the Massachusetts securities division.) Some of the companies whose shares surged were targets of Melvin Capital, a hedge fund that has been singled out by day traders. Those included Evotec, which was up 9.6 per cent; CD Projekt, which rose 5.3 per cent; and the German battery manufacturer Varta, which rose 12 per cent before trimming its gains to trade up 6.2 per cent. Melvin on Wednesday revealed it had closed its GameStop position, having sustained a multibillion-dollar loss on its shorts since the start of this year. Retail investors are using “a tried-and-true hedge fund strategy of swarming crowded trades held by weak-handed investors”, said Andrew Beer, managing member at fund firm Dynamic Beta Investments. In contrast to the US, which has limited disclosure on short bets, hedge funds and other investors have to disclose when they have shorted more than 0.5 per cent of a company’s stock in the EU and the UK, making it easier to target a fund’s positions. Melvin’s latest disclosure shows it has bet against more than 6 per cent of Evotec’s shares, making it the largest single wager against a European company by percentage of shares shorted, according to the data provider Breakout Point. The US hedge fund’s bet against Varta is the fifth largest. The “short squeeze phenomenon fuelled by retail investors’ discussions is spilling over to Europe”, said Ivan Cosovic, founder of Breakout Point. “We are recently detecting some European stocks being touted as ‘the next GameStop’ among retail investors.” The targeting of hedge funds will be viewed with irony by many financial market insiders, given that such funds are often the protagonists in short-selling attacks on troubled companies. Heavily shorted shares with no link to Melvin also rose on Wednesday. Shares in Pearson, the British education publishing company that is the third-most shorted stock in Europe, according to IHS Markit, climbed 14 per cent to close at its highest level in 16 months. Daniel Sundheim’s New York-based hedge fund D1 Capital Partners, which has also been shorting Varta, has the biggest bet against Pearson, at 3.8 per cent of its share capital. The real estate company Wereldhave, in which Woodson Capital has disclosed a 4.2 per cent short position and London-based Adelphi has a 3.6 per cent bet, rose about 5 per cent. Hedge funds in Europe are now fervently scouring lists of most-shorted stocks and message boards such as Reddit for any signs that their short bets could be in trouble. “Any good hedge fund group will be looking at this,” said the head of one multibillion-dollar European hedge fund group. One European hedge fund manager who specialises in short selling described the recent stock market rallies as “insane”, but said the elevated share prices of troubled companies would “make a great opportunity” for short sellers that survived the week’s mayhem. Additional reporting by Patrick Temple-West
netcurtains: Sainsburys I think is trading below its NAV value. So that is quite a safety net for nervous investors.
spob: Tesco to pay back £585m of Covid business rates relief Supermarket says it is ‘conscious of our responsibilities to society’ Opinion: where Tesco leads on rates relief others should follow Mark Sweney The Guardian 2 Dec 2020 Tesco is to pay back the £585m in business rates relief accepted from the UK government to help the supermarket weather the coronavirus pandemic, months after paying investors hundreds of millions in dividends after sales soared. Tesco, which said “every penny” of the rates relief had been spent on responding to the pandemic, added that in making the repayment it was “conscious of our responsibilities to society”. In total, the big six supermarkets – Tesco, Sainsbury’s, Asda, Morrison, Aldi and Lidl – will save £1.9bn in bills during the tax year to 31 March 2021, according to figures from Altus Group, a property adviser. Tesco, which defended its decision to pay a £315m dividend to shareholders in October, is to pay back the rates relief and its move ramps up pressure on rivals to follow suit. “The board has agreed unanimously that we should repay the rates relief we have received,” said John Allan, the chairman of Tesco. “We are financially strong enough to be able to return this to the public and we are conscious of our responsibilities to society. We firmly believe now that this is the right thing to do and we hope this will enable additional support to those businesses and communities who need it.” The big supermarkets have been heavily criticised for taking the payouts over concerns that taxpayer money could have been directed to sectors that really needed the financial support. Tesco maintains that the government made the right decision to step in with the support at the beginning of the pandemic, when supermarkets faced being overwhelmed logistically as shoppers started panic-buying, supply lines were stretched to breaking point and there was the possibility of mass absenteeism. “[There was a] real and immediate risk to the ability of supermarkets to feed the nation,” the company said. “We are immensely grateful for the financial and policy support provided to us by the governments of the UK. This was a gamechanger and allowed us to ensure customers got access to the essentials they needed.” Tesco said costs relating to the pandemic are estimated to hit £725m this year but paying back the rates relief is the corporately responsible thing to do. “While business rates relief was a critical support at a time of significant uncertainty, some of the potential risks we faced are now behind us,” said Ken Murphy, Tesco’s chief executive. “Every decision we’ve taken through the crisis has been guided by our values and a commitment to playing our part. In that same spirit, giving this money back to the public is absolutely the right thing to do by our customers, colleagues and all of our stakeholders.” Tesco, Sainsbury’s and Morrisons have paid dividends to shareholders even while receiving the state aid. Sainsbury’s disclosed business rates relief worth £230m in the first half of its financial year, while paying £231m in dividends. The government introduced a 12-month break on business rates in March across England and Wales because it feared the pandemic would strain retailers’ finances, potentially threatening their ability to feed the country. However, the reality proved very different, with big supermarkets enjoying a sales boost, albeit with higher costs. Altus’s projections showed that Tesco, the UK’s largest supermarket chain, is expected to receive relief worth £585m during the year, while Sainsbury’s will receive £498m. Asda and Morrisons will receive £297m and £279m respectively.
sharesoc: We are hosting a webinar with Sainsbury's plc on Tuesday 24th November which may be of interest to potential shareholders and current investors. James Collins, Head of Investor Relations at Sainsbury’s plc will present a full overview on the company, its strategy and the outlook for the coming year. More details and registration can be found here: hTTps://
loganair: The petrol stations giant led by two brothers who have agreed to buy Asda for £6.8bn is to generate hundreds of millions of pounds by selling a stake in its holding company to a group of blue-chip global investors. Sky News has learnt that EG Group could confirm as early as Wednesday that an Abu Dhabi sovereign investor and two of Canada's largest pension funds are acquiring a minority stake. The deal will value EG at more than $20bn (£15.1bn), including debt, according to an insider. It will see the Alberta Investment Management Corporation (AIMCo) and PSP Investments become new shareholders in EG, while the Abu Dhabi Investment Authority (ADIA) will top up its existing stake in the EG holding company structure. One source said the transaction would imply an equity value of more than $12bn (£9bn), paving the way for the company to stage a mammoth stock market flotation in the next couple of years.
loganair: Sainsbury's share price forecast 2021: will the company adapt to the industry’s new reality? by Nicole Willing. Shares in UK supermarket chain Sainsbury’s have dropped by 15 per cent this year, despite grocery sales rising at their fastest rate in more than two decades during lockdowns to tackle the Covid-19 pandemic. What is driving the company’s stock lower? And what is the SBRY share price forecast 2021 and beyond? The highly competitive grocery market in the UK makes for volatile stocks. Investors closely following Sainsbury’s share price news would have seen that the stocks of three of the four largest retailers – Tesco, Sainsbury’s and Morrisons – have all fallen by 15 per cent year to date, while the share price for online supermarket Ocado has doubled since the start of the year. Sainsbury’s cedes market share, faces increased costs: When deciding what to do with Sainsbury shares – buy or sell, investors should consider its position in the market. Sainsbury’s was founded in 1869 and listed on the London Stock Exchange in 1973 – at that time, the largest-ever initial public offering on the exchange. Sainsbury's share price has been in decline since 2018, as the largest supermarket chains have lost market share to discount retailers. The stock fell by around 10 per cent in 2019 and reached its lowest level in 30 years. Sainsbury’s market share has dropped to 14.9 per cent from 16 per cent in 2019, data from Kantar shows, while competitors like Aldi, Lidl, and Co-op have gained ground. Sainsbury’s share price forecast 2021: can the stock turn around? Sainsbury’s share price is likely to continue to trade lower, at least in the near term. In fact, SBRY is one of the most shorted stocks on the London Stock Exchange. Shore Capital last month reiterated its recommendation to buy the stock with a Sainsbury share price forecast of £1.87, and the stock has since risen above that level. Analysts at Barclays also recommended the stock as a buy ahead of its interim results on November 5, citing its strong underlying free cash flow, anticipated higher sales and strategic update. Their price target of £2.50 per share indicates a potential upside of around 25 per cent. Technical forecasting service WalletInvestor indicates the share price will continue to decline, falling to £1.89 in December. Its Sainsbury's share price forecast 2021 shows the price dropping further to £1.58 by the end of the year and slipping to £0.98 by December 2023 and £0.44 by October 2025.
loganair: Tempted by the Sainsbury’s share price? Let’s examine the facts: Sainsbury’s share price – recovering or ailing? Market sentiment has been against Sainsbury’s for some time now. Its share of the UK grocery market has declined from around 17% at peak to 14.9% currently, whilst the expensive failed merger with Asda dented confidence in the group management. Although the pandemic has led a surge in grocery demand, this has been through the less profitable channel of online sales. Analysts also expect around £500m of pandemic related costs, forcing a delay in store investment. It is also interesting to note that Sainsbury’s depends heavily on non-food sales, driven mainly by its acquisition of Argos. This element of choice purchases by consumers leaves it more vulnerable to the economic downturn that we now find ourselves in. The final dose of bad news for investors comes in the form of the ailing bank. After requiring significant capital injections over the last two years, the expectation is that a further £350m could be needed to cover bad debts and write-downs until 2023. The period of historically low interest rates also makes generating profit from banking difficult. summary: Given these significant headwinds, I can’t see any basis for investment, so I’m avoiding the Sainsbury’s share price for now. Indeed, it has declined further since the April examination. However, if you do like the look of the supermarket sector in general, I see reasons to be optimistic in Morrisons latest trading statement. The share price is nearly identical to Sainsbury’s, but Morrisons is yielding a superior dividend, and has lifted its interim payout by 5.7%. Although half year profits fell significantly, the rise in like-for-like sales excluding fuel sat nicely at 8.7%, leaving it well placed to focus on improving profitability. Similar to Sainsbury’s, a portion of this growth was through the online channel, but crucially Morrisons is starting from a smaller online and delivery presence than its rivals, and as such has more room to grow. The strengthening of its relationship with Amazon also gives more room for expansion in this area. In announcing expectations of improved free cash flow, reduction in net debt and underlying pre-tax profit, I see a momentum in Morrisons that Sainsbury’s lacks, and as such the former’s shares are worth a very close look from potential investors in my opinion.
loganair: What the experts say: Michael Schirrmacher, UK Managing Director at Bloomreach, believes that Sainsbury’s should be a lesson to all retailers that the key to winning in the current environment is having a good digital offering. “As more and more consumers migrate online to purchase anything from food and clothes to medicine and even children’s toys, businesses are fast realising that they can no longer afford to have a weak online presence: today, shoppers are more likely to connect with a brand online first before making their way to a high street branch,” he says. According to Bloomreach’s State of Commerce Experience report, 90% of customers have changed their behaviour as they avoid physical stores, putting discretionary spending on hold and buying exclusively online or as much as possible. Half of customers even said that they are shopping on digital channels for products they’ve never bought online before. And this is having a huge impact on investment: in the same report, the company found that investment in brick and mortar stores has dropped by almost 30% since the start of the lockdown (from 52% to 24%). “This shows that businesses understand the urgent need to enhance the digital experience they are offering customers who all think digital first,” says Schirrmacher. “Shoppers are more unforgiving than ever before when it comes to a bad digital experience, and brands simply can’t afford to lose customers to their competition because a product was hard to find, or it took too long to load a page. Whether your business is in survival, adaptive, or growth mode, now is a critical time to reallocate funding to deliver enhanced digital experiences and set your business up to be more competitive as the world shifts to a new normal post-pandemic.”; Neil Shah, Director of Research, Edison Group, sounds a note of caution. “Despite strengthening sales, increase in costs related to reacting to the crisis will clearly weigh in or earnings this year as the company expects flat underlying pre-tax profit for the 2020-21 year.” He adds: “All of the UK’s major supermarket groups have seen grocery sales boosted during the lockdown, and both Sainsbury and Tesco have been clear winners of the back of their vast network of superstores supported by an increase of online demand and local convenience stores.” Shah concludes: “However, investors should keep a close eye on Sainsbury and be slightly cautious around the company´s growth over the past months. With lockdown easing and normality returning, it will be interesting to see how the company, who has been losing market share for the past few years, manages to keep up with their positive sales and growth." Joe Healey, Investment Research Analyst at The Share Centre adds: “This is a strong update from Sainsbury which has performed better than expected as it continues to invest in lower prices alongside improving its stores.” Healey continues: “The group has also showcased its flexibility to manage the increase in capacity from the pandemic effectively. Nearly 50% of new online groceries are from new customers with the supermarket now taking over 650,000 orders a week compared to just 370,000 pre-crisis. The flexibility to double capacity speaks volumes of the technology and digital platforms Sainsbury operate and will be something investors will be very pleased with moving into the future.” He concludes: “However, it’s important for investors to remember these results were always going to be higher thanks to the combination of consumers purchasing bigger baskets and good weather. Whether this theme will continue is unlikely. It is prudent to see management are not expecting this sales growth to continue considering the uncertainty we still have surrounding consumer spending and something which investors should bear in mind.”
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