Tesco Share Prices Going South

Wobblydeb

Nope, I wouldn't buy into this dip. When Tesco took a hit last May, I bought Sainsbury, because as a customer, I see them doing everything better.

That remains the same now, so no, I wouldn't be buying Tesco until it is clear they have sorted out some of the issues.

You may scoff at the idea of taking a micro view of business, but I believe it reflects what is going on across the group when a company is so centrally controlled and homogenised.

I can shop at either a Tesco Metro or a Sainsbury Local store on the way home from work. The Sainsbury store has been consistently better stocked for the last 3 years. Tescos is woeful, with empty shelves and/or lots of short date stock. It has reached the point where I don't even bother trying the Tesco store, despite having to walk past it first.

Glen_Clark

Wobblydeb wrote: »

The Sainsbury store has been consistently better stocked for the last 3 years. Tescos is woeful, with empty shelves and/or lots of short date stock. It has reached the point where I don't even bother trying the Tesco store, despite having to walk past it first.

That could be a reason to buy Tesco shares since they have got more room for improvement?

Glen_Clark

Wobblydeb wrote: »

I wouldn't be buying Tesco until it is clear they have sorted out some of the issues.

..... by which time the price would have risen :mad:

Wobblydeb

Glen_Clark wrote: »

..... by which time the price would have risen :mad:

Yep, if we could time if perfectly we would all be millionaires

Thrugelmir

How much profit was generated from overseas? Was this up on last year.


(Haven't had a chance to read and digest the results yet).

Ifts

I bought some this time last year when SP dipped, since then the holding is up about 15% and I have got a dividend of around 4.6% paid out on the money I put into Tesco shares, its been better than leaving money in a bank account earning next to nout!

If SP goes near the levels it was last year I will be picking up some more.

bowlhead99

Thrugelmir wrote: »

How much profit was generated from overseas? Was this up on last year.

About a billion trading profit between Asia and Europe, which is a little down over last year. This is on a bit under £21bn revenue, while the whole group does 65bn revenue. Revenues 6% up in Asia (the bigger region) but 6% down in Europe. Growth pace is slowing with 6.2 million square feet added across the business being ~3.5m lower than what they added the year before (each of UK, Asia, Europe having a million or so sq. ft fewer additions than year before).

Ifts wrote: »

I bought some this time last year when SP dipped, since then the holding is up about 15% and I have got a dividend of around 4.6% paid out on the money I put into Tesco shares, its been better than leaving money in a bank account earning next to nout!

Me too, I had been considering for a few years but never got around to buying in while it was going like a train since 2003 at £2. Five years ago it was looking expensive at well over 4 quid but having missed the 2008/9 price crash as an opportunity to buy in, I found it over 4 quid again which was still pricey in a poor economy. I (along with you and Warren Buffet!) thought the big fall in Jan 2012 was overdone and an opportunity to buy a decent business at a de-risked price.

So to the OP, I bought at 312.5p around 13 months ago and it has given me 4.7% of that back as cash dividends so far and then increased 24% in price to 387p. Now it fell back ~20p, five percent or so from the recent highs. Hardly justifies a 'going south' headline. You'll almost certainly find a cheaper entry point at some point in the next five years, as five percent is nothing in a market where the average FTSE stock is up 10%+ in only a few months. There will of course more expensive entry points in the next five years too, IMHO.

Some of the shares bought in the tranche for 312.5p are part of a small portfolio to hopefully buy a first second-hand car for my nephew. He's currently 2, so does not mind if they go north or south next week.

sabretoothtigger

What PE is Tesco rated at? I think I read after all deductions their profit is about 200m which would make them over 100 PE so no wonder the stock is not doing fabulous

Part of this how you look at them or appraise their reliable profit in future. Its more then 200m a year. Revenue might be a clearer view

Its the first time in two decades they have reported less profit then the previous year, if thats right I guess it explains most of their worth

*Kat*

I'm so torn, I currently hold 619 shares...not a lot I know but it comes straight out of my wages in a BAYE capacity. I'm not sure whether to continue or hold buying for now and see what happens. I guess 10% isn't a lot to come out of my wages but still

atush

Buying when the price is low (or getting lower) is how you make money- not buying when it is high and rising.

As for the PE, most of this year's problems are one off write offs in disposing of the US business so would not occur again next year.

As for fresh and easy, not sure how Tesco managed to balls that up. I know that they started before the downturn, but things are turning round and Whole Foods does need a competitor.

I know loads of friends and family who shop at WF, and my niece only buys her dog organic dog food for crissakes!