Will the Ocado share price keep delivering ahead of its H1 earnings?
Ocado has seen its share price soar in recent months, with investors eagerly awaiting its half-year results on Tuesday 14 July to get an update on its performance and what it has in store in the second half 2020.
Ocado has seen its share price soar in recent months and is well-positioned to see its gains continue, with growing interest in its tech platform from global retailers and its new joint venture with Marks & Spencer (M&S).
And with its half-year results on Tuesday 14 July, investors are eager for an update on the company’s performance and an outlook on what its ambitions are for the second half of 2020.
The growth potential of its tech platform has helped the company exceed nearly all analysts’ expectations, with the stock up over 1000% since its initial IPO price of 159p per share back in 2010.
Ocado is trading at £20.04 per share at the time of publication.
The online grocery delivery platform will unveil its half-year results on Tuesday 14 July.
From September 2020, Ocado will end its 20-year partnership with Waitrose and enter a new relationship with M&S, after the retailer acquired half of its grocery business in a deal valued at around £750 million.
Covid-19 has made online demand for groceries skyrocket, with the new joint venture with M&S capable of reaping major rewards for both parties if executed correctly and able pushing Ocado’s stock higher in the fourth quarter of 2020 to become one of the UK’s top tech stocks.
Licensing could be key to Ocado's ongoing growth
Outside of Ocado’s joint venture deal with M&S and, arguably the key driver of its share price gains in 2020, is its digital grocery platform which it licenses several leading supermarkets from around the world, assisting them with their online sales, storage and distribution. This includes Morrison in the UK, Groupe Casino in France, ICA Gruppen AB (publ) in Sweden, Coles Group Limited in Australia, Kroger Co in the US, Sobeys in Canada and Aeon in Japan.
Ocado is becoming a vital partner for major retailers looking to automate and digitise their businesses and has plenty of room to grow considering its tech can be used by more industries than just groceries.
As a consequence, Ocado continues to outperform its peers and broader market, with the stock up 59% year-to-date compared with FTSE 100 which is down 19% over the same period.
FTSE 100 rebounds from recent weakness
The FTSE 100 has been one of the weaker performers of late, having failed to hold on to the gains from late May and early June, according to Chris Beauchamp, chief market analyst at IG.
‘Early gains this morning have seen it rebound from the lows of Friday’s session, but the price will need to clear 6300 to the upside to suggest a bullish breakout is in play,’ he added.
‘A turn lower, below 6250, would likely signal that a downward move is back in play, targeting 6000 and lower.’
How to trade stocks with IG
Looking to trade Ocado and other stocks? Open a live or demo account with IG and buy (long) or sell (short) shares using derivatives like CFDs in a few easy steps:
- Create an IG trading account or log in to your existing account
- Enter ‘Ocado’ in the search bar and select it
- Choose your position size
- Click on ‘buy’ or ‘sell’ in the deal ticket
- Confirm the trade
This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.
Act on stock opportunities today
Go long or short on thousands of international stocks with CFDs.
- Get full exposure for a comparatively small deposit
- Trade on spreads from just 0.1%
- Get greater order book visibility with direct market access
See opportunity on a stock?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on a stock?
Don’t miss your chance – upgrade to a live account to take advantage.
- Trade a huge range of popular stocks
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See opportunity on a stock?
Don’t miss your chance. Log in to take advantage while conditions prevail.
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
