- Sainsbury (J)
- 04 July 2025 10:41:23
Source: Sharecast
RBC Capital Markets said it had come away from Thursday's investor call "encouraged" by Sainsbury's momentum, particularly in food, noting that the company's food-focused approach was "seeing traction with consumers", and that it expects continued momentum to be supported by ongoing innovation and also by a reallocation of general merchandise space to good.
The Canadian bank also said Sainsbury's valuation looks undemanding relative to key peers, leading it to reiterate its 'outperform' rating on the stock.
"Following SBRY's Q1 trading update earlier this week, we have nudged up our FY26-27 EPS forecasts. Our PT moves to 305p from 300p. SBRY is currently trading at c.13x CY25e P/E, a little ahead of ts historic average but at a wider than average discount to TSCO (c.2x vs c.1x historically), despite a similar MSD % CY24-27 EPS CAGR and a higher all-in yield this year (>10%), from a combination of ordinary dividends, special dividends and a share buyback," added RBC.
Reporting by Iain Gilbert at Sharecast.com