Market News & Analysis


Top Story

What to Expect from Ocado's Full Year Results

When: 
Tuesday 11th February

Expectations:
  • Sales £1.8 billion exp. vs £1.6 billion 2018
  • Pre-tax loss £143 million
The results come shortly after December’s update on the Ocado M&S partnership, which means that attention will be firmly on Ocado’s attempts to become an international player.

Solutions Division
The solutions division will attract the most attention in the full years results. This is where retailers pay Ocado to use its robotic warehouse and delivery system. This division has been ear marked as a key source of future growth making developments all the more interesting and new sign ups all the more important. Japan’s Aeon, one of the largest retailers in Asia has signed up which bodes well for the future, but also upped 2019’s operating costs by a hefty £25 million. 
Ocado has invested in tech- heavy fulfillment centers and is running at a pre-tax loss, which is expected to have widened. 

A bit of faith
Ocado’s share price has rallied over 34% across the past 12 months. Part of this rally has been owing to its diversification away from online grocer towards high tech international player. Although most of that rally happened around March and April last year and the stock has been trading sideways for the past 10 months.




Investors are waiting patiently to see whether Ocado can live up to its new tech stock valuation. The fact that they are willing to do so shows a level of confidence from the market. However, it also means that Ocado will need to execute its plan without any glitches, glitches which could send the share price sharply lower.

Levels to watch
The share price has just slipped below its 50, 100 and 200 sma on the daily chart. It is testing strong support around its current levels. A breakthrough here could open the door to 1173p (low 4th Dec), prior to 1120p (22nd Nov) and 1050p (low 13th Nov)
On the flip side near term resistance is at 1250p (200 sma), before 1280p (high 31st Jan) and 1320p (high 29th Jan). 



From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.