Tesco (TSCDY) AI Stock Analysis

• Market Cap: $29.67B
• Dividend Yield: 3.25%
• Average Volume (3M): 43.53K
• Price to Earnings (P/E): 14.6
• Beta (1Y): 0.27
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: US
• Employees: 340,000
• Sector: Consumer Defensive
• Sector Strength: 91
• Industry: Grocery Stores
• EPS (TTM): 0.49
• Shares Outstanding: 2,244,347,200
• 10 Day Avg. Volume: 130,585
• 30 Day Avg. Volume: 43,528
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.32
• Price to Cash Flow (P/CF): 5.40
• P/FCF Ratio: 6.90
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

Tesco's overall stock score reflects strong financial performance, with stable revenue growth and effective cost management. However, technical analysis indicates bearish momentum, with the stock trading below key moving averages. The valuation suggests the stock might be slightly overvalued, but the dividend yield provides a moderate return for investors. The lack of recent earnings call data or significant corporate events means these factors did not impact the score.

Tesco Business Overview & Revenue Model

Company Description

Tesco PLC (TSCDY) is a leading multinational grocery and general merchandise retailer headquartered in the United Kingdom. Founded in 1919, Tesco operates across several sectors, including food retail, financial services, and telecommunications. The company is primarily known for its extensive network of hypermarkets, supermarkets, and convenience stores, offering a wide range of products including groceries, clothing, electronics, and household goods. Tesco also runs a successful online shopping platform, catering to a broad customer base across Europe and Asia.

How the Company Makes Money

Tesco primarily generates revenue through its extensive network of physical retail stores, which sell groceries and general merchandise. The company also earns income from its online retail platform, offering delivery and collection services. Tesco's revenue streams are diversified with additional contributions from its financial services division, Tesco Bank, which provides insurance, credit cards, and personal loans. Additionally, the company has a telecom segment, Tesco Mobile, a joint venture with O2, offering mobile phone services. Strategic partnerships and loyalty programs, such as Clubcard, enhance customer retention and increase sales by providing personalized offers and rewards. Tesco's supply chain efficiency and scale allow it to offer competitive pricing, further bolstering its market position and profitability.

Tesco Financial Statement Overview

Summary

Tesco's financial statements present a robust picture of growth and stability. The income statement indicates solid revenue growth and effective cost management with a score of 78. The balance sheet shows a well-managed leverage situation, scoring 72, though with room for improvement in equity returns. Cash flow analysis highlights strong operational cash generation, scoring 65, albeit with some variability in free cash flow. Overall, the financial performance is strong but could benefit from improved free cash flow sustainability.

Income Statement

Tesco has demonstrated stable revenue growth in recent years, with a 3.7% increase in Total Revenue from 2023 to 2024. The Gross Profit Margin decreased slightly, indicating some pressure on gross profitability, but the company maintained a solid Net Profit Margin of 1.74% in 2024. The EBIT and EBITDA margins reflect effective cost management and operational efficiencies. Overall, the income statement shows strong growth potential and effective cost control, although slight pressure on profitability margins must be monitored.

Balance Sheet

Tesco's balance sheet shows a moderate Debt-to-Equity Ratio of 1.27, indicating a balanced approach to leveraging debt. The Return on Equity (ROE) at 10.17% reflects decent shareholder returns, though it has dipped from previous years. The Equity Ratio of 24.81% suggests a stable capital structure. While the company maintains adequate liquidity, continued monitoring of debt levels is advisable to ensure long-term financial stability.

Cash Flow

The Free Cash Flow has remained relatively stable despite fluctuations in capital expenditures, with a slight decrease from 2023 to 2024. The Operating Cash Flow to Net Income Ratio is strong, indicating effective cash generation from operations. However, the Free Cash Flow to Net Income Ratio highlights the need for improved cash flow conversion. Overall, the cash flow statement reflects solid operational cash flow generation but highlights some volatility in free cash flow sustainability.

Breakdown
Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
68.19B	65.76B	61.34B	57.89B	58.09B
	Gross Profit
4.66B	4.68B	4.69B	3.86B	4.41B
	EBIT
2.82B	2.62B	2.71B	2.09B	2.67B
	EBITDA
4.83B	3.23B	4.40B	3.10B	4.83B
	Net Income Common Stockholders
1.19B	737.00M	1.48B	690.00M	971.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
4.67B	4.45B	4.65B	3.70B	5.42B
	Total Assets
47.04B	46.13B	49.35B	45.51B	53.15B
	Total Debt
14.84B	15.08B	15.36B	15.67B	17.79B
	Net Debt
12.50B	12.61B	13.01B	13.16B	13.65B
	Total Liabilities
35.37B	33.90B	33.71B	33.45B	39.78B
	Stockholders Equity
11.67B	12.24B	15.66B	12.08B	13.39B
Cash Flow		Free Cash Flow
2.45B	2.56B	2.61B	-737.00M	-1.10B
	Operating Cash Flow
3.84B	3.81B	3.79B	640.00M	108.00M
	Investing Cash Flow
-1.70B	-790.00M	-1.77B	6.13B	2.34B
	Financing Cash Flow
-1.86B	-3.19B	-2.23B	-7.84B	-1.94B

Tesco Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 14.29
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSCDY, the sentiment is Positive. The current price of 14.29 is above the 20-day moving average (MA) of 13.40, above the 50-day MA of 13.71, and above the 200-day MA of 13.62, indicating a bullish trend. The MACD of 0.26 indicates Negative momentum. The RSI at 60.18 is Neutral, neither overbought nor oversold. The STOCH value of 91.11 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSCDY.

Tesco Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WMT	79 Outperform	$762.32B	39.85	22.23%	0.90%	5.07%	25.86%
COST	78 Outperform	$433.55B	56.95	32.89%	0.47%	6.13%	12.14%
BJ	75 Outperform	$14.75B	27.99	32.33%	―	2.67%	2.72%
KR	73 Outperform	$46.26B	19.42	26.59%	1.78%	-1.94%	23.94%
Sector *	64 Neutral	$9.20B	14.61	4.34%	185.58%	3.95%	5.80%
TSCDY	62 Neutral	$29.67B	14.64	15.35%	3.25%	―	―
TGT	60 Neutral	$44.00B	10.76	29.12%	4.62%	-0.79%	-0.90%