Supermarket chain J Sainsbury (SBRY) seems to have won the battle of the retailers over the Christmas period.
‘We have won grocery market share for the sixth consecutive Christmas period, again delivering our winning combination of value, quality, service and availability for customers,’ said chief executive Simon Roberts.
UK grocery sales in the 16 weeks to 3 January were up 5.4% on a like-for-like basis compared with a 3.7% increase for Tesco (TSCO) over a similar period.
One particular area where the firm excelled was premium own-brand, where Taste The Difference was the best-selling range across the grocery sector.
Shareholders get cash back
Stronger sales mean retail free cash flow is expected to exceed the company’s £500 million target this year and shareholders are set to benefit.
Over the financial year to March 2026, Sainsbury’s will return more than £800 million of cash through ordinary dividends, £250 million of special dividends and a £250 million share buyback.
| Price: 313.2 -4.8% | P/E: 17x |
| Market Cap: £7bn | Yield: 4.2% |
As anyone who has studied the forms knows, Sainsbury’s has a knack of upping its game and winning the battle of the supermarkets each Christmas.
The Kantar till roll data earlier this week showed the group had increased its market share dramatically from 15.3% to 16.3% in the run-up to the big day.
That marks the highest level since the start of 2018, something chief executive Simon Roberts has every right to be proud of.
The group has clearly pulled lots of levers to get sales up, but it has been helped by higher prices as food price inflation is still running between 4% and 5%.
We can only assume today’s sell-off is a reaction to the recent strong performance of the shares rather than any fundamental concerns.
Read the press release here: https://corporate.sainsburys.co.uk/investors/
Read related news here: https://sharesify.com/tesco-shares-fall-after-sales-miss-forecasts/
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