- Tesco
- 13 September 2024 07:57:36
Source: Sharecast
The bank has raised its target by to 425p from 350p and reiterated a 'buy' recommendation on the stock.
This month's Kantar market share data showed that Tesco's dominance of the UK grocer market continued to grow, with a 27.8% market share in the 12 weeks to 1 September, up 5.3% on the same period last year and the highest share since January 2022.
Citi predicts that total retail like-for-like (LFL) sales have grown 3.8% in Tesco's second quarter, up from 3.4% in the first, driven by improvements in the UK, Central Europe and the Booker division, offset by a slight slowdown in the Republic of Ireland (ROI).
The second-quarter acceleration is "supported by low-single-digit UK food inflation, and four straight quarters of UK market share gains", Citi said.
As a result, the bank's forecast for full-year earnings before interest and tax has risen by 1% to £2.867bn, compared with Tesco's own guidance of at least £2.8bn.