Staple Retail equity research

Explore the most viewed and latest equity research and media content for companies within the Staple Retail sector. Stocks in this sector provide goods and services in the food wholesale and drug retail industries.

Staple Retail equity research

Explore the most viewed and latest equity research and media content for companies within the Staple Retail sector. Stocks in this sector provide goods and services in the food wholesale and drug retail industries.

Latest Content

Greggs

Greggs - On a roll - unscheduled vegan-driven upgrade

After only seven weeks, Greggs’ vegan sausage roll has already led us to an upgrade, our third in two months. With its smart approach to social media, the company is succeeding in disrupting out-of-date perceptions, which appears to be bringing new customers into the stores. While multiples are optically high, we believe there may be further upgrade potential.

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  • 19 Feb 19
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METRO

Finally, a good performance!

Ceconomy has finally posted a good performance (vs three profit warnings announced over the past year). The key takeaways were: 1) overall positive lfl growth (despite a weak October performance), 2) stable profitability despite a 60bp slump in the gross margin, and 3) further reduction in the tax rate (which we believe is structural in nature). Although the stock price is up c.15% today, we do not see any growth trigger unless the new CEO shares the performance turnaround plan (expected on 21 May 2019).

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  • 08 Feb 19
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Ocado Group

Facing hurdles in the near term

While we do not see any red flags in the FY18 results, the announcement of a one-hour delivery service is encouraging. If successful, ‘Ocado Zoom’ should aid Ocado in improving market share and shareholder wealth in the mid/long-term. Although the fire incident at the Andover facility will be a pain-point / earnings adverse in the near term, we see the 17% plus stock price slump over the past 48 hours as an over-reaction. No change in the stock recommendation.

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  • 07 Feb 19
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METRO

New captain to join the ship

The appointments of a new CEO and CFO were much awaited but is still a step in the right direction. Although Jörn Werner has a good track record, we expect the stock price to remain range-bound unless he comes up with a tangible performance turnaround plan.

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  • 31 Jan 19
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W7L MRS TOT NET ANP BRY ALSP ARCM CFX

Small Cap Feast

Techniplas –global producer and support services company providing highly engineered and technically complex components, making the supply chain to original equipment manufacturers more efficient. FYDec17 rev $515m. Circassia Pharma (CIR.L) - specialty pharmaceutical company focused on respiratory disease transferring from the Main Market. No funds being raised. Due 4 Feb. Greenfields Petroleum (TSX-V:GNF) production focused company with operated assets in Azerbaijan seeking AIM dual listing including $60m private placement. Mkt cap $12.6m CAD. Expected late January 2019. Chaarat Gold Holdings—RTO, the Company intends to acquire Kapan Mining and Processing CJSC, which owns the Shahumyan mediumsized polymetallic mine in Kapan in the Republic of Armenia. No raise, market cap of £110.1m, due early Feb

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  • 29 Jan 19
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Carrefour

Decent Q4 performance; turnaround plan on track

Although five key countries clocked negative lfl in Q4, some of the pain should alleviate gradually. On the positive note, the strong performance in LatAm is likely to continue. We also remain content with the progress of the performance turnaround plan. The guidance of a 4% increase in profit is an encouraging development. The revival of performance in Europe would be a stock price trigger in the near term. We maintain our stock recommendation.

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  • 24 Jan 19
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Casino Guichard Perrachon

Strong Q4 lifts investor confidence

Casino’s Q4 performance is commendable considering the apprehensions about lost sales from Yellow Vest protests in France. However, non-food remains a pain-point and its revival is vital for further margin improvement. We expect the positive momentum to continue in FY19, both in France as well as in Brazil. We reiterate our confidence in the food retailer – management should be able strengthen its omni-channel proposition and also de-leverage the company in the forecast years. No change in our stock recommendation.

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  • 18 Jan 19
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Jeronimo Martins SGPS

Value contingent on Polish performance

Jeronimo Martins is likely to face tougher competition / higher promotional activity in its key operating geography, Poland. Striking the balance between Polish lfl growth and profitability would be a key stock price trigger in our opinion. We have tweaked our earnings estimates slightly, but no change in the stock recommendation.

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  • 15 Jan 19
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Tesco

A good Christmas for Tesco

Tesco’s ability to regain lfl momentum after a softer Q3 in the UK is noteworthy. However, the company needs to improve the international operations (especially in Poland and Thailand) in order to be re-rated upwards. We have tweaked the earnings estimates but maintain the stock recommendation.

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  • 14 Jan 19
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J Sainsbury

Managing through uncertain times

Negative lfl is not a surprise but the magnitude of the slump surely is. There seems to be no short-term solution to turnaround the performance of the non-food business, which puts Sainsbury’s at a much higher risk vs other competitors. We continue to believe that the proposed merger with Asda will go-through, albeit with some store disposals. A harsh verdict might make it very difficult for Sainsbury’s to extract much desired cost savings and a simultaneous cut in the price of essential products.

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  • 10 Jan 19
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