Home » best stock today » Ocado shares analysts outlook 2012

Monday, January 30, 2012

Ocado shares analysts outlook 2012

Ocado shares analysts outlook 2012 : Although Ocado’s service is clearly popular, many analysts fear its business model is flawed. There are concerns that its hi-tech distribution centre leaves it with eye-watering costs that will hurt profits and it will struggle to compete with supermarkets.

Ocado has an agreement with Waitrose to sell its products. But the upmarket store chain is now increasingly treading on its toes by upping its own delivery service, particularly within Ocado’s stronghold within the M25.

Its problems are set to be compounded by a vicious supermarket price war, which has seen Tesco launch its Big Price Drop campaign. This is set to hurt Ocado, which guarantees to match Tesco’s prices on identical branded goods.

The uncertainties have been reflected in Ocado’s share price, which has dropped nearly two-thirds in the past year.

Its stock recently enjoyed a rebound after the group reported strong Christmas trading as it postponed the improvement works to its Hatfield site to allow it cash in on the peak period.

But the recent announcement that chief financial officer Andrew Bracey is to move on has fuelled uncertainty.

The City is expecting underlying earnings of £28 million, 27% higher than the previous year, but this is not expected to translate to a bottom-line profit. For the latest updates on the stock market, visit Stock Market Today For the latest updates PRESS CTR + D or visit Stock Market news Today

Related Post:

Posted by at
Labels:

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)