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Profit margins will be slim short term but 585 million business rates relief coupled with fewer promotions lower fuel prices and increased trade will off set a lot of damage tesco will be very careful not to be seen as thriving during this crisis but the fact of the matter is tesco is smashing sales budgets and when the new norm sets in eg increased home shopping sales and folk reverting back to doing large one off shops going where all is available tesco is really well positioned to take advantage profit will balance out by year end and when we come out of this a real feel good factor will return which means higher sales and normal profit margins resumed one of the safest dividend stocks buy buy buy..
Well I hope this is explained to share holding colleagues simply. Wouldn't want them to think that the company has nicked their shares :-)
Well I think they will pay out the special dividend which currently is forecasted to be 50p. So say the share price is 250 it falls to £2 I would think they will do a 3 for 1 to take it to £6 as currently there is 10 Billion shares in circulation of which only 2.7% ish is held by private investors ( if you look at page 160 area I think of the 2017/18 report it tells you the percentage of shareholders of which there was something like 8000 that held over 10.000 shares and 614 with over 50000 and so forth ( now just a thought here maybe there is a special meeting or get together of shareholders of over 10,000 or 50,000 that Tesco don’t want the big saye folk that now get in to this category to attend !) I remember on my dot com round there was a fella who had a million shares and our old store manager ( ****) would make us make sure his shopping was perfect! Question is how did he know? ( maybe some of our manager friends know “poker chips can shed light on this area at all “)
The 50p special dividend. Has anyone understood the full document on the web site? I have read it a couple of times and still can't work out whether it is 50p per pre-consolidation share or 50p post-consolidation share?
My understanding of the wording is that Tesco does not want to see 50p shaved off the share price come ex div date. This would bring it down to £1.80ish at the current price. To maintain the sp at £2.40ish it would mean replacing four shares with three shares.
Dividend, how do you qualify, do you have to have held for 1 year?
Completely agree. I am a manager too. I am a little worried about costs, are many of your colleagues sick & out of work?
Can't understand why anyone would be selling this share with special dividend due I am a manager with Tesco and see some sales figures just a few regions mind you but we are still absolutely smashing sales and some dot com stores will see a 100% uplift in sales great share to be in next stop 280.
Thanks Roswell,
Informative post. Have to wait and read the small print.
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Re Share consolidation and special dividend. The text says:
"Return of proceeds to shareholders
It is currently expected that the return of proceeds to shareholders of c.£5.0 billion will be implemented by way of a special dividend. In order to maintain the comparability of the Group’s share price and per-share metrics before and after the return of proceeds, the Company also intends to undertake a share consolidation in conjunction with the return of proceeds. It is expected that full details of the return of proceeds and share consolidation will be made available to shareholders shortly after Completion, at which time a separate general meeting will be convened to seek shareholder approval for the return of proceeds and associated share consolidation. "
We will have to wait and see what that means. Just fingers crossed that the Thailand and Malysia authorities give the go ahead. Given the "Kitchen of the World" vision of the new (hopefully) owners, will it be viewed as anti competitive.
HSBC RAISES TESCO PRICE TARGET TO 280 (250) PENCE - 'BUY'
Ventured out to Tesco yesterday , and was very impressed with the care they are taking with the customers , and their staff . Trolley was wiped down , our hands given a good spray , and the layout with directional arrow markings on floor explained , and then told where we had to queue ready for paying. Well done Tesco .
"ex employe, best company I have worked for and would still be there if not made redundant."
No. Loyalty works both ways and there sure as heck no loyalty coming from the company.
Does anyone know if there are special conditions attached to the circa 50p special div? I.e when you held the stock? Or if you bought now would you still be eligible for the special dividend (if the sale goes through of coarse)
Long term tesco holder and ex employe, best company I have worked for and would still be there if not made redundant.
No chance. We’ll get 50p a share imo.
Well worth holding just for divs and special divs now
Are you saying the special dividend will be taken back in a share consolidation? So in effect you get nothing ?
Hi guys. Latest development is that customers will be restricted to one online order a week where slots exist. If you place an order for yourself and for, say, your parents then you won't get two slots. You will have to buy two weeks worth in one order (subject to 80 items limit) . This is needed to provide slots for priority customers (usually low value orders).
Filmed this in late march. Justin discusses supply chains, divi's, sustainability of profits across the sector. He discusses Sainsbury's, Tesco, Ocado & Morrisons
https://youtu.be/uVBjQu9YCks
For anyone who doesn’t need their money soon, this looks like the safest bet on lse imo. In the current crisis the stock price seems to be stable and once god willing we’re past this corona problem this should flourish.
Thought here. So when the SD gets paid, I take it ( believe) you’ll have the option of taking cash or having it in more shares? That said the shares will roughly fall 50p from say £2 to £1.50 for arguments sake. Now does the 9p dividend the company pay out yearly over two instalments stay the same as that would then imply a %6 yield going forward which wouldn’t be sniffed at in the current world standings.
Rubbish, great company, no real impact if Lockdown relaxed by August. Increased profits, lower debt.
Re Tesco Bank, taken from annual report 2020
"Material impact from COVID-19
• Reduction in income from all activities
• Provisions for potential bad debts
• Likely to result in a loss in 2020/21"
In Tesco bank, fewer transactions, more cash residing in the accounts - after all, what can you spend it on.
in Booker, there is some growth in the likes of schools, nurseries and care homes business but doubt very much if it makes a dent in the loss of business from pubs, clubs, restaurants etc
Isn't there downside in Booker and Tesco Bank?
Yes I recognise that Tesco costs (staffing in particular and delivery) have risen BUT with Lockdown and fear and the fact that no one can eat out supermarkets will continue to see boosted figures. I think that a large number of eateries will never reopen especially if the distancing rules are applied strictly? I do not know about you but being stuck at home increases daily food intake due to boredom etc.? I will continue to add on the dips and with the dividend still being paid all should be rosy. Not much downside?
CCC,
Those were the days well before "coaching" was a management style ...back then the big bosses ran things with a certain amount of managerial fear , such were the demands, and all the ranks down the line had to do what was asked. I remember a boss saying to me once " Dont ask me how to do it, just f*cking do it " .
Everyone was terrified of a Senior Manager store visit and we all had spies within head office to try and find out where the big chiefs were going and when and we begged any PA to give us plenty of advanced warning. You might be walking around the store with a Seniro Manager for 3 hours and you had to be on the top of your game and have every store statistic lodged firmly in your head.
As you say, they would castigate someone for not havingfor example, the breakfast cereals lined up correctly , and that b*llocking would go all around the region and beyond and everyone would then have extra staff assigned to breakfast cereals, until the next "flavour of the month" passed around...I think it was wine bottles next !!...The competition against the likes of Sainsbury was fierce and they operated in much the same way at that time and I did work for a time with them too.
I do remember selling Sainsbury shares at over 600p ....those were the days !!