The headlines may seem bad, but if you dig deeper into the latest results there are no big surprises in Tesco’s (TSCO:LN) release of the latest quarter’s results. In fact they are more or less on the median of analyst expectations.
Judging by the investor’s reactions to the new release that day. Which aside from a kneejerk fire sale, fast stabilised and clawed back most of the lost ground. There is little reason to overly be concerned at this moment I think.
I am not convinced that the £1bn investment on UK stores is having as big an impact as many would have liked (flat like-like sales), this has to however be considered against the economic background, and I don’t think the competitors results (not including the small players) have been particularly spectacular either.
While I really don’t see any major issue looming, I equally don’t see any kind of overreaction and a reason to stock up on Tesco. The jury on the recovery plan could be said to be firmly still “out”.
For now I think I will sit fast and observe.
On a separate note, I notice that Ruspetro (RPO.L) has finally clawed back some of its losses on my porfolio’s balance. Still a long long way to go before I can jump off with any kind of profit though. If indeed that day will ever come. My ever present reminder of why a stop-loss is vital (along with the discipline to follow it through).
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