Analyst Views: What do you think of the strategy announced by Sainsbury’s?

 
Kasmira Jefford
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NICLA DI PALMA | BREWIN DOLPHIN
What disappoints us is that management did not take a more aggressive stance with closing underperforming stores. Instead, Coupe will try to increase the non-food offer and possibly introduce some concessions. Management is loath to shrink, although we believe they could have taken the extra step.

DARREN SHIRLEY | SHORE CAPITAL
Despite the greater visibility on Sainsbury’s strategic plans, we continue to believe that much of Sainsbury’s short- and medium-term earnings prospects will remain dependent upon the magnitude of the much anticipated Tesco price/margin reset… We struggle to forecast future years with confidence.

MIKE DENNIS | CANTOR FITZGERALD
We believe the key to the value simplicity strategy is growing like-for-like customer numbers and retaining loyal larger basket shoppers. The dividend cut is a significant shift away from its previous strategy and in our view reflects the threat that Tesco will reset pricing and costs to a lower level to recover lost market share.

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