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J Sainsbury plc (GB:SBRY)
LSE:SBRY

J Sainsbury plc (SBRY) AI Stock Analysis

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GBJ Sainsbury plc
(LSE:SBRY)
64Neutral
J Sainsbury plc demonstrates steady revenue growth and strong operational cash generation but faces challenges with declining profit margins and a substantial drop in free cash flow. Despite neutral technical indicators and an overvalued P/E ratio, the earnings call and corporate events provide a positive outlook for future performance, supported by strategic expansion and capital returns.

J Sainsbury plc (SBRY) vs. S&P 500 (SPY)

J Sainsbury plc Business Overview & Revenue Model

Company DescriptionFounded in 1869, Sainsbury's is the second-largest U.K. grocery chain with 16.5% market share. It operates over 600 supermarkets and 800 convenience stores, all in the U.K., with 90% of sales generated by supermarkets. The company has diversified away from core food by selling clothing, telecom equipment, and other nonfood items. In September 2016, it took a step further into nonfood retailing with the purchase of Home Retail Group, operating the Habitat and Argos chains (general merchandise and electronics stores), for GBP 1.1 billion. It has been selling products online since 1997.
How the Company Makes MoneySainsbury's generates revenue primarily through its supermarket operations, which account for the majority of its income by selling groceries and household items. The company operates both large-format stores and smaller convenience stores, catering to a diverse customer base. In addition to physical retail locations, Sainsbury's has a strong online presence, enabling customers to shop for groceries and other products via its e-commerce platform. Argos, as a subsidiary, contributes to the company's revenue by selling a wide array of consumer goods, both online and in-store. Sainsbury's Bank adds another dimension to its revenue streams, offering financial services such as loans, credit cards, and insurance products. Strategic partnerships with suppliers and ongoing investments in technology and supply chain efficiency further support Sainsbury's revenue generation efforts.

J Sainsbury plc Financial Statement Overview

Summary
Income Statement
Balance Sheet
Cash Flow
Breakdown
Mar 2024Mar 2023Mar 2022Mar 2021Mar 2020
Income StatementTotal Revenue
32.70B31.49B29.89B29.05B28.99B
Gross Profit
2.34B2.32B2.21B2.04B2.19B
EBIT
532.00M999.00M982.00M691.00M1.06B
EBITDA
1.79B1.84B2.40B1.44B1.90B
Net Income Common Stockholders
137.00M207.00M677.00M-208.00M152.00M
Balance SheetCash, Cash Equivalents and Short-Term Investments
2.00B1.81B1.02B1.67B1.08B
Total Assets
25.06B26.39B27.15B25.47B28.17B
Total Debt
6.55B7.14B7.38B6.94B7.42B
Net Debt
4.56B5.83B6.56B5.36B6.42B
Total Liabilities
18.19B19.13B18.73B18.77B20.64B
Stockholders Equity
6.87B7.25B8.42B6.70B7.53B
Cash FlowFree Cash Flow
400.00M1.66B202.00M1.50B1.05B
Operating Cash Flow
1.97B2.39B896.00M2.10B1.69B
Investing Cash Flow
-1.01B-725.00M-651.00M-575.00M-571.00M
Financing Cash Flow
-282.00M-960.00M-1.02B-1.31B-1.07B

J Sainsbury plc Technical Analysis

Technical Analysis Sentiment
Negative
Last Price250.00
Price Trends
50DMA
260.74
Negative
100DMA
261.34
Negative
200DMA
266.57
Negative
Market Momentum
MACD
-1.79
Positive
RSI
39.46
Neutral
STOCH
53.65
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SBRY, the sentiment is Negative. The current price of 250 is below the 20-day moving average (MA) of 257.84, below the 50-day MA of 260.74, and below the 200-day MA of 266.57, indicating a bearish trend. The MACD of -1.79 indicates Positive momentum. The RSI at 39.46 is Neutral, neither overbought nor oversold. The STOCH value of 53.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:SBRY.

J Sainsbury plc Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
£315.65M7.6515.67%6.43%7.75%-21.78%
73
Outperform
£26.03B23.1110.18%3.31%
GBMKS
70
Outperform
£7.60B14.9015.23%0.82%6.87%22.36%
64
Neutral
£5.77B42.231.99%5.17%2.66%80.49%
63
Neutral
$20.85B13.27-10.88%7.48%1.13%11.50%
56
Neutral
£47.21M-27.15%-15.67%45.17%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:SBRY
J Sainsbury plc
250.00
12.94
5.46%
OCDGF
Ocado Group
2.83
-2.72
-49.01%
GB:CARD
Card Factory
84.00
-8.35
-9.04%
GB:WINE
Naked Wines plc
63.80
-1.20
-1.85%
GB:MKS
Marks and Spencer
376.00
137.41
57.59%
GB:TSCO
Tesco plc
388.70
118.93
44.09%

J Sainsbury plc Earnings Call Summary

Earnings Call Date: Nov 7, 2024 | % Change Since: -5.12% | Next Earnings Date: Apr 17, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a strong performance in the grocery segment with significant market share gains and strategic expansion plans, although challenges in Argos and rising operational costs temper the outlook. The sentiment is balanced by a strong grocery performance and strategic investments but countered by operational challenges in other segments.
Highlights
Record-Breaking Grocery Volume Growth
Sainsbury's achieved the biggest market share gains in the industry for big basket main weekly shop customers, with a grocery growth of 5% despite inflation. This is attributed to quality, service, and value improvements, with customer perception of value up 8.5 percentage points year-on-year.
Strong Financial Performance and Profit Leverage
Sainsbury's reported a retail underlying operating profit growth of 3.7% year-on-year to £503 million, driven by a strong increase in grocery volumes and an 8.7% growth in Sainsbury's profit contribution, well ahead of sales growth of 4.6%.
Expansion Plans and Strategic Investments
Sainsbury's is expanding its supermarket coverage with the acquisition of 11 Homebase stores and two Co-op stores, aiming to open 20 new supermarkets by March 2026. These investments are expected to deliver a return on capital employed in the low teens.
Financial Services Division Success
The underlying operating profit for Financial Services grew by 38% to £18 million. The company expects to deliver total annual income from Financial Services of at least £40 million by the financial year ending March 2028.
Lowlights
Argos Performance Challenges
Argos sales declined by 5% in the first half, primarily due to difficult weather comparatives and a reduction in online traffic. A tough first quarter was followed by a need for clearance activity, impacting margins.
Increased Costs from National Insurance
The company's labor costs are expected to increase significantly due to changes in National Insurance, estimated to cost Sainsbury's £140 million, posing inflationary pressure on the business.
General Merchandise and Clothing Decline
Sainsbury's General Merchandise and Clothing sales declined by 1.5%, although Clothing returned to growth in the second quarter with an 8.3% increase.
Company Guidance
In the recent call, Sainsbury's provided detailed guidance for its fiscal year, highlighting several key metrics and strategic initiatives. The company projects a Retail underlying operating profit between £1,010 million and £1,060 million, expecting a growth rate of 5% to 10% year-on-year. Sainsbury's reported a 4.6% sales growth in the first half, with Grocery sales growing by 5%. The company achieved an 8.7% increase in Sainsbury's profit contribution, attributed to strong grocery volume growth and operating leverage, with Sainsbury's margin up 20 basis points. Despite a decline in Argos sales by 5% due to challenging conditions, Sainsbury's anticipates a stronger Argos performance in the second half, traditionally its more profitable period. The company remains focused on increasing its market share in the grocery sector, with the biggest improvement in customer value perception up by 8.5 percentage points year-on-year. Additionally, Sainsbury's plans to save £1 billion in structural costs over three years, aiming for £500 million in retail free cash flow for the year. The expansion strategy includes the acquisition of 13 new stores, adding significant value to its key strategic locations.

J Sainsbury plc Corporate Events

Regulatory Filings and Compliance
Sainsbury’s Announces Current Share Capital and Voting Rights
Neutral
Mar 3, 2025

J Sainsbury plc announced that as of 28 February 2025, its issued ordinary share capital consists of 2,339,424,088 ordinary shares, with no shares held in Treasury. This figure represents the total number of voting rights in the company, which shareholders can use to determine their notification obligations under the Disclosure Guidance and Transparency Rules.

M&A TransactionsBusiness Operations and Strategy
Sainsbury’s Completes Sale of Argos Financial Services Card Portfolio
Positive
Mar 3, 2025

J Sainsbury plc has completed the sale of its Argos Financial Services store card portfolio to NewDay Group, following the latter’s acquisition of the necessary financing and antitrust approvals. This transaction is expected to enable Sainsbury’s Bank to return at least £250 million in excess capital to Sainsbury’s, which the company plans to distribute to its shareholders. The transition of legal title and servicing responsibilities to NewDay is anticipated to occur in Q1 2026, with no immediate changes required for existing customers.

Business Operations and StrategyRegulatory Filings and Compliance
Sainsbury’s Executive Acquires Shares Under Incentive Plan
Neutral
Feb 14, 2025

J Sainsbury plc announced that Mark Given, the Chief Marketing, Data, and Sustainability Officer, acquired 43 ordinary shares through the company’s Share Incentive Plan at a price of £2.6485 each on the London Stock Exchange. This transaction is part of the company’s ongoing effort to align managerial interests with shareholder value, as outlined by the UK Market Abuse Regulation. It reflects Sainsbury’s commitment to enhancing stakeholder engagement and corporate governance practices.

Executive/Board ChangesRegulatory Filings and Compliance
Sainsbury’s Executive Sells Shares Amidst Regulatory Compliance
Neutral
Feb 12, 2025

J Sainsbury plc announced that Clodagh Moriarty, the company’s Chief Retail & Technology Officer, sold 142,474 ordinary shares at £2.640 per share. This transaction, completed on February 11, 2025, is part of the company’s compliance with the UK Market Abuse Regulation, and was conducted on the London Stock Exchange. Such notifications are significant as they reflect potential shifts in managerial confidence or strategy and may influence stakeholder perceptions.

Regulatory Filings and Compliance
J Sainsbury Confirms Share Capital and Voting Rights
Neutral
Feb 3, 2025

J Sainsbury plc announced that as of 31 January 2025, its issued ordinary share capital consisted of 2,339,151,338 shares, with no shares held in Treasury. This figure defines the total number of voting rights, providing a basis for shareholders to determine their notification requirements under relevant rules.

Private Placements and Financing
Sainsbury’s Announces Final Terms for £550M Note Issuance
Neutral
Jan 29, 2025

J Sainsbury plc has published the final terms for two significant notes under its £5 billion Euro Medium Term Note Programme. The company issued £250 million at 5.125% due in 2030 and £300 million at 5.625% due in 2035, indicating a strategic move to secure financing and potentially strengthen its financial position in the retail market.

J Sainsbury’s CMO Acquires Shares through Incentive Plan
Jan 17, 2025

J Sainsbury plc announced that its Chief Marketing Officer, Mark Given, acquired 45 ordinary shares through the company’s Share Incentive Plan, purchasing them at a price of £2.569 each. This transaction, carried out on the London Stock Exchange, aligns with the UK Market Abuse Regulation guidelines, emphasizing transparency in managerial dealings within the company.

Sainsbury’s £5 Billion EMTN Programme Approved
Jan 17, 2025

J Sainsbury plc announced the approval and availability of the prospectus for its £5 billion Euro Medium Term Note (EMTN) Programme. The programme’s approval by the Financial Conduct Authority marks a significant step in Sainsbury’s financial strategy, potentially impacting its market operations and stakeholder engagement.

Sainsbury’s Celebrates Record Christmas Sales and Announces Pay Raise
Jan 10, 2025

J Sainsbury plc reported its fifth consecutive year of winning grocery market share during the Christmas period, driven by its strong customer service, value, and product quality. The company achieved record sales and customer satisfaction scores, with significant growth in its premium ‘Taste the Difference’ range and party food sales. In response to cost inflation, Sainsbury’s announced a pay raise for its hourly-paid employees, reinforcing its commitment to rewarding its workforce. The company expects to meet its full-year profit guidance, supported by grocery volume growth, strong Nectar sales, and cost-saving measures. Sainsbury’s continues to invest in technology and customer service enhancements to support its growth and market positioning.

Sainsbury’s Major Holdings Update: BlackRock Adjusts Stake
Jan 8, 2025

J Sainsbury plc, a leading UK-based retailer, has announced a change in its major holdings as BlackRock, Inc., a significant shareholder, has adjusted its voting rights in the company. As of January 6, 2025, BlackRock’s total voting rights in Sainsbury decreased from 7.27% to 6.89%, which may impact the company’s shareholder dynamics and influence. This change reflects a shift in the financial instruments and shares BlackRock holds in Sainsbury, indicating possible strategic adjustments by the investment firm.

Pzena Investment Management Boosts Stake in J Sainsbury plc
Jan 8, 2025

Pzena Investment Management, LLC, a New York-based investment firm, has increased its voting rights in J Sainsbury plc to 5.05%, as of January 3, 2025. This development indicates a potential shift in stakeholder influence within the company, which could affect its strategic decisions and market positioning.

J Sainsbury Confirms Voting Rights and Share Capital Structure
Jan 2, 2025

J Sainsbury plc announced that as of December 31, 2024, its issued ordinary share capital consisted of 2,339,036,204 ordinary shares, with no shares held in Treasury. This figure represents the total number of voting rights, which shareholders can use for any necessary notifications under the Disclosure Guidance and Transparency Rules.

J Sainsbury CMO Acquires Shares in Confidence Boost
Dec 20, 2024

J Sainsbury plc has announced that Mark Given, the Chief Marketing Officer, has acquired 43 ordinary shares at £2.716 each through the Company’s Share Incentive Plan. This transaction, reported in compliance with the UK Market Abuse Regulation, signifies a commitment from senior management towards the company’s growth and stability, potentially boosting stakeholder confidence.

J Sainsbury plc Grants Share Options to Key Executive
Dec 19, 2024

J Sainsbury plc announced that Graham Biggart, a key managerial figure, has been granted options to purchase ordinary shares at a fixed price under the company’s Savings-Related Share Option Scheme. This move is part of the company’s regulatory compliance and aims to align managerial interests with shareholder value, potentially impacting the company’s market positioning and stakeholder relations.

J Sainsbury Completes £200 Million Share Buyback Programme
Dec 17, 2024

J Sainsbury plc has completed the second tranche of its £200 million share buyback programme, purchasing 861,910 of its ordinary shares at a volume weighted average price of 277.64 pence per share. This buyback, aimed at shareholder value enhancement, signifies the completion of the company’s announced programme and involves the cancellation of the acquired shares, potentially impacting the company’s market positioning by reducing the total number of shares outstanding.

J Sainsbury plc Executes Share Buyback as Part of Strategic Financial Management
Dec 16, 2024

J Sainsbury plc announced the purchase of 1,069,008 of its ordinary shares as part of its existing share buyback program, with prices ranging from 278.60 to 280.60 pence. This move is part of the company’s strategic financial management, intending to cancel these shares to optimize shareholder value and align with market regulations.

Sainsbury Executes Strategic Share Buyback
Dec 13, 2024

J Sainsbury plc, a prominent player in the retail sector, has executed a share buyback transaction, acquiring 1,579,381 ordinary shares through UBS AG London Branch as part of its existing buyback program. The purchased shares, acquired at a volume weighted average price of 278.64 pence, are intended to be canceled, signaling a strategic move to potentially enhance shareholder value and optimize capital structure.

J Sainsbury Continues Share Buyback Program
Dec 11, 2024

J Sainsbury plc announced the purchase of 1,317,464 of its ordinary shares as part of its ongoing share buyback program, with the highest price paid being 273.60 pence per share. The company plans to cancel these shares, which is part of a strategic move to enhance shareholder value by reducing the number of shares outstanding.

Sainsbury Executes Share Buyback to Boost Value
Dec 6, 2024

J Sainsbury plc has executed a share buyback, acquiring 947,888 of its ordinary shares at an average price of 266.37 pence per share. This move is part of the company’s ongoing strategy to enhance shareholder value by reducing the number of outstanding shares. The company plans to cancel the repurchased shares, potentially boosting earnings per share and investor confidence.

J Sainsbury Executes Significant Share Buyback
Dec 5, 2024

J Sainsbury plc has executed a share buyback, purchasing over a million of its own shares at an average price of 264.45 pence each, as part of its ongoing buyback program. These shares will be cancelled, a move that often indicates the company’s confidence in its financial health and can potentially enhance shareholder value.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.