RE: Sinking ship lol 😂22 Jan 2026 18:12
Ocado is a structurally cash-burning business with no credible path to sustainable profitability. Holding Ocado shares does not constitute investment; it represents a speculative position with an unfavourable risk-reward profile that, in my view, is worse than gambling.
The company lacks a viable standalone business model. Its continued operation is heavily reliant on external partners, most notably Marks & Spencer, whose strategic priorities are clearly aligned with protecting their own retail interests rather than maximising value for Ocado shareholders. There is no indication that M&S has any incentive to support Ocado beyond what serves its own commercial objectives.
Consumer behaviour further undermines the long-term investment case. While online grocery has a role, consumers have not abandoned physical shopping. Many prefer to visit stores, compare offerings, and make purchasing decisions in person. This reality places a structural limit on demand for Ocado’s capital-intensive, automation-led fulfilment model.
The Ocado business model has required sustained and substantial capital investment, yet has consistently failed to generate adequate returns. Significant sums have been deployed with the expectation of future scale benefits that have not materialised. Instead, shareholders have faced dilution, persistent losses, and ongoing cash outflows.
Following what is expected to be a materially weaker full-year result, the share price is likely to deteriorate further, with levels around 68P appearing plausible. On this basis, the stock represents a strong sell, and the risk of financial distress or eventual administration cannot be dismissed.
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