Ocado | Morrisons - comment
Kantar figures for the four weeks to 16 April are out. Grocery inflation is slowing, and the comps will start to get easier from June. The market share gains by Aldi/Lidl mean that margins will remain under pressure for the rest of the pack.
Ocado was the best performer in the online market (up 8.7%). The quicker Ocado gets its JV with M&S back to profitability and cash generation, the better for the valuation of that part of the business.
Morrisons continue to have some improvement in sales, which Sales have been rising since the trough in October last year. This recovery is at the expense of price investment funded by sale and leaseback operations. The necessity of price support is demonstrated by Aldi passing through a 10% market share 140bps above Morrisons.