Shares of Ocado Group (GB:OCDO) surged today after the company reported strong sales for its grocery business, Ocado Retail Ltd., in Q4 2024. According to its latest trading update, the company’s retail revenue grew by 17.5% to £715.8 million in the fourth quarter, leading to a strong performance in 2024. Following the update, Ocado’s share price gained over 10% as of writing.
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Ocado Retail is an online supermarket that operates as a joint venture between Ocado Group and Marks and Spencer Group (GB:MKS).
Ocado Shatters Christmas Sales Records
Ocado reached its highest sales ever during the peak holiday trading period, shattering all its previous Christmas sales records. The company attributed its solid performance to its expanded seasonal range, its competitive pricing, and exceptional customer support.
In Q4, the growth was fueled by a 12.1% rise in its active customer base, which has now exceeded 1.1 million. Meanwhile, the average weekly orders increased from 407,000 to 476,000, reaching a peak of 500,000 by the end of November. For FY24, sales increased by nearly 14% to £2.7 billion, surpassing the guidance of mid-to-high single-digit percentage growth.
Moving forward, the company expressed confidence in maintaining sales growth and higher volumes in FY25. The company will announce its full guidance for FY25 alongside Ocado’s results on February 27.
Is Ocado Stock a Good Buy?
Despite its strong performance, Barclays analyst Sarah Roberts confirmed her Sell rating on OCDO stock. She predicts a downside of 28% in the share price.
Overall, OCDO stock has received a Moderate Sell rating on TipRanks based on four Sell and one Buy recommendations. The Ocado share price forecast is 290.35p, which is 2% below the current price level.
