Tesco PLC

BATS-CHIXE:TSCOl Stock Report

Market Cap: UK£24.6b

Tesco Valuation

Is TSCOl undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of TSCOl when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: TSCOl (£3.67) is trading below our estimate of fair value (£6.43)

Significantly Below Fair Value: TSCOl is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for TSCOl?

Key metric: As TSCOl is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for TSCOl. This is calculated by dividing TSCOl's market cap by their current earnings.
What is TSCOl's PE Ratio?
PE Ratio13x
EarningsUK£1.90b
Market CapUK£24.59b

Price to Earnings Ratio vs Peers

How does TSCOl's PE Ratio compare to its peers?

The above table shows the PE ratio for TSCOl vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average20.6x
MKS Marks and Spencer Group
15.3x7.1%UK£7.7b
SBRY J Sainsbury
34.7x20.6%UK£6.1b
CBOX Cake Box Holdings
16.2xn/aUK£80.0m
AD Koninklijke Ahold Delhaize
16.4x10.0%€30.1b
TSCOl Tesco
13x1.5%UK£24.6b

Price-To-Earnings vs Peers: TSCOl is good value based on its Price-To-Earnings Ratio (13x) compared to the peer average (20.6x).

Price to Earnings Ratio vs Industry

How does TSCOl's PE Ratio compare vs other companies in the European Consumer Retailing Industry?

2 CompaniesPrice / EarningsEstimated GrowthMarket Cap
No. of Companies8PE0816243240+
2 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: TSCOl is good value based on its Price-To-Earnings Ratio (13x) compared to the European Consumer Retailing industry average (15x).

Price to Earnings Ratio vs Fair Ratio

What is TSCOl's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

TSCOl PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio13x
Fair PE Ratio19.8x

Price-To-Earnings vs Fair Ratio: TSCOl is good value based on its Price-To-Earnings Ratio (13x) compared to the estimated Fair Price-To-Earnings Ratio (19.8x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst TSCOl forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUK£3.67
UK£4.02
+9.4%
7.8%UK£4.45UK£3.16n/a14
Nov ’25UK£3.47
UK£3.93
+13.1%
12.1%UK£4.45UK£2.70n/a13
Oct ’25UK£3.59
UK£3.70
+3.1%
11.7%UK£4.25UK£2.70n/a13
Sep ’25UK£3.53
UK£3.46
-1.9%
11.4%UK£4.00UK£2.40n/a13
Aug ’25UK£3.31
UK£3.37
+1.9%
9.4%UK£3.70UK£2.40n/a13
Jul ’25UK£3.07
UK£3.36
+9.4%
9.5%UK£3.70UK£2.40n/a13
Jun ’25UK£3.11
UK£3.36
+7.9%
9.5%UK£3.70UK£2.40n/a13
May ’25UK£2.99
UK£3.30
+10.4%
11.4%UK£3.70UK£2.20n/a12
Apr ’25UK£2.97
UK£3.29
+10.7%
11.6%UK£3.70UK£2.20n/a12
Mar ’25UK£2.78
UK£3.29
+18.3%
11.6%UK£3.70UK£2.20n/a12
Feb ’25UK£2.82
UK£3.25
+15.3%
11.2%UK£3.70UK£2.20n/a12
Jan ’25UK£2.90
UK£3.21
+10.8%
10.4%UK£3.60UK£2.30n/a12
Dec ’24UK£2.80
UK£3.17
+13.5%
9.7%UK£3.50UK£2.30n/a12
Nov ’24UK£2.71
UK£3.15
+16.3%
8.9%UK£3.50UK£2.40UK£3.4711
Oct ’24UK£2.65
UK£3.07
+15.9%
7.0%UK£3.30UK£2.50UK£3.5910
Sep ’24UK£2.65
UK£3.07
+15.9%
5.4%UK£3.30UK£2.70UK£3.5310
Aug ’24UK£2.59
UK£3.05
+18.0%
5.1%UK£3.30UK£2.70UK£3.3110
Jul ’24UK£2.49
UK£3.08
+23.6%
5.6%UK£3.30UK£2.70UK£3.0710
Jun ’24UK£2.61
UK£2.93
+12.6%
13.0%UK£3.30UK£1.78UK£3.1112
May ’24UK£2.81
UK£2.92
+3.7%
12.8%UK£3.30UK£1.78UK£2.9912
Apr ’24UK£2.66
UK£2.84
+6.6%
12.9%UK£3.30UK£1.78UK£2.9712
Mar ’24UK£2.51
UK£2.72
+8.4%
12.0%UK£3.10UK£1.78UK£2.7812
Feb ’24UK£2.47
UK£2.72
+10.0%
12.2%UK£3.10UK£1.78UK£2.8212
Jan ’24UK£2.25
UK£2.75
+22.4%
18.9%UK£4.33UK£1.78UK£2.9015
Dec ’23UK£2.28
UK£2.73
+19.4%
20.1%UK£4.33UK£1.78UK£2.8014
Nov ’23UK£2.18
UK£2.73
+25.0%
20.1%UK£4.33UK£1.78UK£2.7114

Analyst Forecast: Target price is less than 20% higher than the current share price.

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