TSX higher on employment data
Investing.com -- Tesco (LON:TSCO) shares were placed on J.P. Morgan’s Positive Catalyst Watch as the brokerage reiterated its “overweight” rating and raised its price target to 450p from 500p, sending the stock up over 2%.
The brokerage cited stronger-than-expected earnings momentum and margin visibility as reasons for the move.
Adjusted earnings per share forecasts were upgraded by 17% for the first half, 7% for fiscal 2026, and an average of 4% for fiscal 2027 and beyond.
J.P. Morgan now estimates adjusted EPS at 30.04p for fiscal 2026 and 34.65p for fiscal 2027, sitting about 10% above consensus.
Analysts said Tesco’s group adjusted operating profit is projected at £3.2 billion for fiscal 2026, compared with company guidance of £2.7 billion to £3 billion.
They noted the company is unlikely to raise guidance in the near term but could narrow its range toward the upper end with the October half-year results, potentially driving consensus upgrades.
The call to place Tesco on Positive Catalyst Watch reflects expectations ahead of its first-half 2026 earnings report due Oct. 2.
J.P. Morgan flagged steady market share gains and a favorable backdrop in the U.K. grocery sector as additional support for its stance.