Sainsbury’s share price: 3 things to watch out for in its half-year results

The British supermarket has seen its shares rebound from a 30-year low, though its first half performance is unlikely to be strong enough to drive further gains.

Sainsbury's will unveil its half-year earnings on Thursday, with investors braced for a disappointing set of results that could prompt its shares to fall.

IG looks at the key things to look out for ahead of Sainsbury’s latest trading update.

Goldman Sachs upgrades outlook ahead of Sainsbury’s results

Goldman Sachs upgraded its rating for the stock to ‘neutral’ in November and issued a 220p price target ahead of Sainsbury’s half-year results.

As it stands, Sainsbury’s share price closed at 206p on Wednesday. Therefore, Goldman Sachs’ analysts think that the stock has a potential upside of 7.3%.

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Sainsbury’s half-year results expected to disappoint

Despite Goldman Sachs’ optimistic outlook for the stock, its results are unlikely to help its shares climb higher, with headline earnings per share expected to fall 12.6% to 9p a share, while revenue is forecast to decline by 0.6% to £15.03 billion.

Analysts remain optimistic ahead of its half-year results, however. Of the 20 analysts covering the shares, seven have ‘buys’, ten have ‘hold’ recommendations, with three ‘sells’. The current median target price of 237p.

You can go long or short Sainsbury’s with IG using derivatives like CFDs and spread bets.

Competition continues to hurt Sainsbury’s sales

Sainsbury’s sales have slumped of late due to stiff competition from rivals like Tesco, Lidl and Aldi.

The highly competitive landscape has led Sainsbury’s to cut costs, with the supermarket targeting £500 million in savings by 2024.

At the same time, Sainsbury’s continues its store opening programme, with 75 new premises set to open next year.


This information has been prepared by IG, a trading name of IG Markets 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.

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