| Date | Subject |
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29/7/2021
11:31 | cwa1: Solid director share purchase:-
https://www.investegate.co.uk/tesco-plc--tsco-/rns/director-pdmr-shareholding/202107291040229111G/
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06/7/2021
12:05 | thamestrader: There's been a lot of positive talk around the sector, including Tesco, so i suspect much of the optimism is already in the price. Could return to the 240-246 range I suppose, if only temporarily, but barring something more concrete I can't see any records being broken here.
This is a steady-as-she-goes sideways moving stock with a decent dividend, and one I am happy to hold and perhaps add to when/if it dips into the low 220s, as it does from time to time (although many of these are probably ex-div dips).
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05/7/2021
08:23 | bountyhunter: SBRY rather expensive, TSCO remains good value and not too big for e.g. Amazon imv
With a bidding war for Morrison that does only leave SBRY and TSCO as comparable targets in the sector unless you include MKS which includes a much higher proportion of non food retail.
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08/6/2021
09:09 | philanderer: Shore Capital: rerating potential at ‘undervalued’ Tesco
Tesco (TSCO) has ended its ‘alliance̵7; with French supermarket group Carrefour but broker Shore Capital says the deal meant little in the first place and the UK supermarket giant remains undervalued.
Analyst Clive Black retained his ‘buy’ recommendation on the stock after the Carrefour-Tesco alliance was brought to an end. He said the benefits were always doubtful and ‘we do not believe [the alliance] amounted to a great deal in the first place’.
Black said: ‘Tesco’s equity, which has been dull as dishwater in recent times, remains undervalued in our view; noting the improved sector economics of the UK grocery scene – it is important to look through the sales comparatives and think more broadly about operating costs and cashflows – the strong free cashflow emerging from the group and its propensity to be shareholder friendly.’
Black said as a ‘cash compounder’ the stock has ‘rerating potential’. The shares closed up 0.3%, or 0.6p, at 226p on Monday.
hxxps://citywire.co.uk/funds-insider/news/the-expert-view-tesco-reckitt-benckiser-bt-morgan-and-travis-perkins/a1516456?section=funds-insider&_ga=2.99759774.1493867754.1623139539-1599687211.1623139539#i=2
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28/4/2021
11:29 | dondee: So, getting back to TSCO and the current share price
Is it at the current share price worth buying bearing in mind the dividend is coming up mid May.
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13/4/2021
22:50 | jimbob: @nathdani
@Questor: Tesco’s loss-making online sales left it exposed – but its fortunes have changed
Questor share tip: a shift in shopping habits has allowed the chain to improve margins on internet orders and fend off competition
By
Richard Evans
11 April 2021 • 5:00am
Supermarkets have hardly been stock market favourites in recent years, partly because of what looked like the inexorable rise of Aldi and Lidl. But investors may have had something else in mind, too: the sheer difficulty of making online shopping profitable.
While Tesco may have made a profit margin of 5pc (before interest and tax) from sales made in its stores, before the pandemic it was making a loss of 4pc of the value of every online order, according to estimates from Exane, the investment firm.
This is not a welcome state of affairs if your online business is steadily growing at the expense of your in-store one. You might imagine that the pandemic has therefore worsened the problem for Tesco (and others) because 10 years’ growth in online sales, let’s say, has been compressed into one. Indeed, the proportion of Tesco’s sales in Britain made online has grown from about 9pc to 16pc. But there is more to the story.
During the pandemic the value of individual online orders has also increased. This helps dilute the effect of the high fixed costs of delivery and “picking”; of the orders in the shops. In addition, drivers have been able to deliver more orders on each round as the average distance between customers has fallen because more have signed up.
Last year Tesco’s fleet delivered 21pc more orders per van than in 2019, according to Majedie, an asset manager that holds shares in the company. At the same time the proportion of online orders that are click and collect has increased from around 13pc of the total to roughly 21pc. As this avoids delivery costs, profitability is better.
A spring in their step
Bar chart with 2 data series.
Supermarket till rolls, 12 weeks to 21 Mar 2021 vs 2020
View as data table, A spring in their step
The chart has 1 X axis displaying categories.
The chart has 1 Y axis displaying £bn. Range: 0 to 9.
End of interactive chart.
“While Tesco does not disclose its online profitability specifically, our engagement with the company has confirmed it is now enjoying a distinctly better economic model than before Covid-19, such that it is no longer seeing significant [profit margin] dilution from online sales relative to in-store,” Majedie said.
That is quite a remarkable shift compared with the margin estimates mentioned above. The asset manager said the market was underestimating the impact of this change.
But there is more to the Tesco story than this, partly because the chain has had a good pandemic in other ways. Customers have been reassured by its coronavirus safety measures, such as “traffic lights” to control entry, and have come back to Tesco’s superstores from the German discounters because their size and range of products mean that shoppers are less likely to bunch in particular places inside the stores.
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A further side effect of the virus has been less of what supermarkets call “promiscuous” shopping: going to more than one in search of the best offers from each – not a good idea if you want to minimise social contact.
Instead, customers increasingly want “everyday low prices” rather than endlessly changing special offers – and once customers perceive, say, Tesco as offering that value they feel more loyalty to the brand. Tesco’s Clubcard helps to cement this feeling.
Not only has the threat from Aldi and Lidl diminished but Asda is likely to be less aggressive a competitor on price now that it is under new ownership. When it was part of the giant Walmart group there was plenty of money to fund loss-leaders or price cuts but its new ownership – the Issa brothers backed by private equity – involves a lot of debt and the firm will need to keep a close eye on profitability.
If you put all these reasons for shoppers to choose Tesco together the result in terms of profits should be significant. This is because supermarkets have what is called “high operational gearing”, which means fixed costs are high and therefore relatively small increases in turnover can translate into big rises in profits once those fixed costs are covered.
Tesco’s transformation following a series of crises about seven years ago was largely thanks to Dave Lewis, who stepped down as chief executive in October last year. His replacement, Ken Murphy, formerly of Walgreens Boots Alliance, and the new finance director who starts next month are expected to adopt an evolutionary approach that builds on Mr Lewis’s work rather than one of drastic change.
James de Uphaugh of Majedie said: “Tesco offers a free cash flow yield of 9pc and a dividend yield of about 4pc. It is a market leader that is gently gaining market share and has a well liked brand.” We said buy in July last year and remain positive.
Questor says: hold
Ticker: TSCO
Share price at close: 234.4p
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27/2/2021
01:02 | cp1402: I had bought Tesco in US ADR on 12-Feb, but during trading hours on US market ? Also, number of shares that I hold on 12-Feb got reduced due to reverse split on 16th-Feb-2021 (i.e. on record date, and after ex-dividend date i.e. 15-Feb-2021). As of today, that is 26-Feb-2021, I have still not received dividend. Should I expect dividend on my account on 26-Feb-2021, or it can be any on or after 26-Feb-2021 ? Had put query to my broker account, but just seek quick information, and found this post thread on Tesco special dividend. Highly appreciate, if someone can provide information.
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14/2/2021
12:09 | amch: I'm hoping for the price to open up tomorrow.
People who sold out to avoid the dividend tax will be buying back tomorrow.
I've seen some confusion about the impact of the dividend. To be clear - the price will NOT drop tomorrow by the dividend amount. The share consolidation closely cancels the impact of the dividend so it shouldn't impact the share price.
The reason Tesco have done it this way is that they don't want their share price chart to show a drop.
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11/2/2021
11:23 | 1carus: Takemetooz and Phil. The special is not like a normal special dividend, it is effectively a forced sale of your shares for cash. At the point where you have the cash and the new number of shares once converted at the new ratio, you should have exactly the same value of assets between cash and shares as you did before the conversion. Unfortunately, if you have these outside of an ISA and you have used up your 2k dividend allowance for the year, you will have to pay dividend tax on the cash part, and that varies dependant on what income bracket you sit in. I was in this situation but chose to sell my entire holding so that I would not pay the dividend tax. Also the raised profit from the sale was less than my capital gains tax for the year so no tax to pay there either. I intend to rebuy the share when they come back on the market. Things to consider: How much divi tax would you have to pay. How much CGT would you have to pay. Cost of selling and buying, Stamp duty on the rebuying the shares. Your tax income bracket when calculating divi or capital gains etc. Additionally, it is a little complicated if you sell and rebuy the shares in a short period of time. If they were exactly the same shares, when you rebuy them you may have a cgt tax liability if you rebuy them at a cheaper value and a tax credit if they are more expensive, that difference should be accounted for in the current tax year. If you do this the share buy value is pegged at the Original share purchase price, not the new price you have just bought at, and this is what would be considered for CGT calculations for later disposals. However, in this case you would be buying the same company but after a share allocation adjustment, something which I have not encountered before , the new shares are not exactly the same thing that you would have sold. I need to think about that a little. There might be someone on here that can clarify that. But if you are well under your CGT limit it would hardly matter. This is only my opinion and may not be totally correct.
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28/1/2021
22:35 | salisbury3: The Financial Times makes it clear that the special dividend is taxable as a dividend (subject to the £2,000 limit). The UK tax legislation makes no distinction between a capital dividend or an income dividend. A dividend is a dividend is a dividend.
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