Tesco PLC

LSE:TSCO Stock Report

Market Cap: UK£25.1b

Tesco Valuation

Is TSCO 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 TSCO when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: TSCO (£3.74) is trading below our estimate of fair value (£6.32)

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

Key Valuation Metric

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

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

The above table shows the Price to Earnings ratio for TSCO. This is calculated by dividing TSCO's market cap by their current earnings.
What is TSCO's PE Ratio?
PE Ratio13.2x
EarningsUK£1.90b
Market CapUK£25.09b

Price to Earnings Ratio vs Peers

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

The above table shows the PE ratio for TSCO vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average21x
MKS Marks and Spencer Group
15.5x9.3%UK£7.9b
SBRY J Sainsbury
36.6x20.6%UK£6.4b
CBOX Cake Box Holdings
15.8xn/aUK£78.0m
AD Koninklijke Ahold Delhaize
16x10.2%€29.4b
TSCO Tesco
13.2x1.5%UK£25.1b

Price-To-Earnings vs Peers: TSCO is good value based on its Price-To-Earnings Ratio (13.2x) compared to the peer average (21x).

Price to Earnings Ratio vs Industry

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

2 CompaniesPrice / EarningsEstimated GrowthMarket Cap
TSCO 13.2xIndustry Avg. 15.0xNo. of Companies10PE01020304050+
2 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: TSCO is good value based on its Price-To-Earnings Ratio (13.2x) compared to the European Consumer Retailing industry average (15x).

Price to Earnings Ratio vs Fair Ratio

What is TSCO'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.

TSCO PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio13.2x
Fair PE Ratio19.8x

Price-To-Earnings vs Fair Ratio: TSCO is good value based on its Price-To-Earnings Ratio (13.2x) 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 TSCO forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUK£3.74
UK£4.02
+7.4%
7.8%UK£4.45UK£3.16n/a14
Dec ’25UK£3.66
UK£4.02
+9.6%
7.8%UK£4.45UK£3.16n/a14
Nov ’25UK£3.48
UK£3.93
+12.9%
12.1%UK£4.45UK£2.70n/a13
Oct ’25UK£3.60
UK£3.70
+3.0%
11.7%UK£4.25UK£2.70n/a13
Sep ’25UK£3.54
UK£3.46
-2.1%
11.4%UK£4.00UK£2.40n/a13
Aug ’25UK£3.30
UK£3.37
+2.0%
9.4%UK£3.70UK£2.40n/a13
Jul ’25UK£3.07
UK£3.36
+9.2%
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£3.00
UK£3.30
+10.1%
11.4%UK£3.70UK£2.20n/a12
Apr ’25UK£2.97
UK£3.29
+11.0%
11.6%UK£3.70UK£2.20n/a12
Mar ’25UK£2.78
UK£3.29
+18.5%
11.6%UK£3.70UK£2.20n/a12
Feb ’25UK£2.83
UK£3.25
+14.8%
11.2%UK£3.70UK£2.20n/a12
Jan ’25UK£2.91
UK£3.21
+10.5%
10.4%UK£3.60UK£2.30n/a12
Dec ’24UK£2.80
UK£3.17
+13.5%
9.7%UK£3.50UK£2.30UK£3.6612
Nov ’24UK£2.71
UK£3.15
+16.3%
8.9%UK£3.50UK£2.40UK£3.4811
Oct ’24UK£2.64
UK£3.07
+16.2%
7.0%UK£3.30UK£2.50UK£3.6010
Sep ’24UK£2.65
UK£3.07
+15.9%
5.4%UK£3.30UK£2.70UK£3.5410
Aug ’24UK£2.59
UK£3.05
+17.9%
5.1%UK£3.30UK£2.70UK£3.3010
Jul ’24UK£2.48
UK£3.08
+24.1%
5.6%UK£3.30UK£2.70UK£3.0710
Jun ’24UK£2.61
UK£2.93
+12.5%
13.0%UK£3.30UK£1.78UK£3.1112
May ’24UK£2.81
UK£2.92
+3.8%
12.8%UK£3.30UK£1.78UK£3.0012
Apr ’24UK£2.66
UK£2.84
+6.7%
12.9%UK£3.30UK£1.78UK£2.9712
Mar ’24UK£2.52
UK£2.72
+8.3%
12.0%UK£3.10UK£1.78UK£2.7812
Feb ’24UK£2.48
UK£2.72
+9.7%
12.2%UK£3.10UK£1.78UK£2.8312
Jan ’24UK£2.24
UK£2.75
+22.8%
18.9%UK£4.33UK£1.78UK£2.9115
Dec ’23UK£2.29
UK£2.73
+19.2%
20.1%UK£4.33UK£1.78UK£2.8014

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

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Company Analysis and Financial Data Status

DataLast Updated (UTC time)
Company Analysis2024/12/17 09:33
End of Day Share Price 2024/12/17 00:00
Earnings2024/08/24
Annual Earnings2024/02/24

Data Sources

The data used in our company analysis is from S&P Global Market Intelligence LLC. The following data is used in our analysis model to generate this report. Data is normalised which can introduce a delay from the source being available.

PackageDataTimeframeExample US Source *
Company Financials10 years
  • Income statement
  • Cash flow statement
  • Balance sheet
Analyst Consensus Estimates+3 years
  • Forecast financials
  • Analyst price targets
Market Prices30 years
  • Stock prices
  • Dividends, Splits and Actions
Ownership10 years
  • Top shareholders
  • Insider trading
Management10 years
  • Leadership team
  • Board of directors
Key Developments10 years
  • Company announcements

* example for US securities, for non-US equivalent regulatory forms and sources are used.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.

Analysis Model and Snowflake

Details of the analysis model used to generate this report is available on our Github page, we also have guides on how to use our reports and tutorials on Youtube.

Learn about the world class team who designed and built the Simply Wall St analysis model.

Industry and Sector Metrics

Our industry and section metrics are calculated every 6 hours by Simply Wall St, details of our process are available on .

Analyst Sources

Tesco PLC is covered by 53 analysts. 14 of those analysts submitted the estimates of revenue or earnings used as inputs to our report. Analysts submissions are updated throughout the day.

AnalystInstitution
Pierre-Yves GauthierAlphaValue
Philip DorganAltium Capital Limited
Jean-Marie L’HomeAurel BGC