However, general retailers took another bashing, as dreadful BRC sales data was revealed and updates disappointed. Generalists have lost almost half of their value on a yearly basis.
ING, reassured by Tesco’s results, maintained its buy stance. “We view Tesco as a core holding,” said the broker. Blue Oar, also advising buy, noted: “While the UK market remains challenging, Tesco expects to trade the business harder and remains committed to improving all aspects of the shopping trip, including price.” Bernstein, with an outperform stance, said Tesco is well-positioned at home and overseas.
Shore Capital spent time visiting stores in the Northwest. The broker was impressed by Next, but not by Marks & Spencer. Shore noted: “We have found M&S’s in-store standards to be somewhat variable on a number of instances at both Simply Food and department stores over the past three months. Perhaps this has been a series of unfortunate choices of venue on our part, but there does appear to be some form of trend.” Following the BRC data, Shore downgraded its M&S forecasts.
Another profit warning from DSGi made the electricals group one of the week’s biggest losers. Landsbanki, advising reduce, said boss John Browett must come up with radical solutions, but warned: “We would be unsurprised if management were tempted to paper over the cracks for a while longer.”
Seymour Pierce, recommending hold, said Browett’s May 15 presentation would be crucial. “While we do not hold our breath for anything too spectacular, we would feel uncomfortable shorting the stock in advance.”
Buy Debenhams, said Panmure Gordon following the retailer’s results. Panmure said: “Yes, it has high debt, but we have regard for the management team and think that the shares reflect the gloomy short-term scenario, but not a return to profit growth.”
JP Morgan was underweight on Signet, following the US and UK jeweller’s prelims. The broker said: “Better trading shouldn’t mask still-heavy macro headwinds to a highly leveraged company.” Citi said: “We fear that UK trends will weaken against tougher comparatives through the year.”
Long-standing Alexon boss John Osborn is to retire and will be succeeded by Jane McNally, who is Peacocks’ buying and merchandising director at present. Kaupthing said: “The market should react positively to a change, given the issues that impacted the share price over the past two years and the untapped potential of several of the