The Tesco PLC (LON:TSCO) Full-Year Results Are Out And Analysts Have Published New Forecasts

Shareholders might have noticed that Tesco PLC (LON:TSCO) filed its yearly result this time last week. The early response was not positive, with shares down 3.5% to UK£2.82 in the past week. The result was positive overall - although revenues of UK£68b were in line with what the analysts predicted, Tesco surprised by delivering a statutory profit of UK£0.25 per share, modestly greater than expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Tesco after the latest results.

View our latest analysis for Tesco

After the latest results, the eleven analysts covering Tesco are now predicting revenues of UK£70.1b in 2025. If met, this would reflect a modest 2.8% improvement in revenue compared to the last 12 months. Statutory per share are forecast to be UK£0.25, approximately in line with the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of UK£70.2b and earnings per share (EPS) of UK£0.25 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

There were no changes to revenue or earnings estimates or the price target of UK£3.29, suggesting that the company has met expectations in its recent result. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Tesco, with the most bullish analyst valuing it at UK£3.70 and the most bearish at UK£2.20 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Tesco shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Tesco's past performance and to peers in the same industry. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 2.8% growth on an annualised basis. That is in line with its 2.5% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 2.8% per year. It's clear that while Tesco's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Tesco. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Tesco analysts - going out to 2027, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Tesco .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.