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Of course, I should have added that I believe the FED will err on the aggressive side re interest rate tightening. Painful months ahead for investors...

The bigger risk is that US inflation is allowed to rise further. More interest rate rises to come imo...

Best of luck Scallop,

Personally I believe Ocado shares have further to fall.

Re your points. The fundraising at £7.95 - Macroeconomic conditions have deteriorated severely since then. Big director buy recently yes, it was mistimed. Cashflow modelling - Just Ocado trying to stem the fall in their share price. Similar presentations have been carried out previously, hasn't stopped the share falling. Tech stocks have further to fall. Worldwide recession around the corner. Huge inflationary pressures. Interest rates rising damaging the growth share model.

Also Ocado retail has downgraded it's sales 3 times this year and is not making any profit. I expect that to worsen as the recession hits so losses start to be incurred. Grocers around the world focussing on their core operations rather than online expansion.

I agree people always need food...

Jefferies cuts Ocado price target to 485 (875) pence - 'hold'

That Detroit CFC is a mini CFC. Good that its opening of course but it's capacity is far below a standard Ocado Solutions CFC size. Less profits to Ocado via those facilities as Ocado receive a percentage of total goods value passed through their overseas partners centres...

JPMorgan cuts Ocado price target to 500 (850) pence - 'neutral'

The Albertsons deal could well delay further Ocado CFC rollout within Kroger.

Sure, automated grocery warehouses may well be dominant in years to come. This economic firestorm though can easily burn Ocado before it achieves it's goals..

Casapinos,

The Albertsons deal is obviously good for Ocado. How good though? Jury's out on that one. Your quote talks about distribution centres (for supermarket operations) rather than CFCs. Will this deal delay Kroger's rollout of other Ocado tech as they focus on tying up the synergies of Albertsons? Kroger could be adjusting their CFC needs in light of the extreme headwinds against the online grocery market.. In the background costs are ramping upwards like never before...

Yes, Kroger acquisition of Albertsons is a big positive were it to happen. Remains to be seen if Kroger will be as positive on Ocados tech in the current market conditions. Likely though that they'd roll out the tech across the Albertsons locations.

Can't see Rishi wanting to serve under Truss. Betting markets (Betfair) have Truss leaving before the next general election as 1/3, her staying to fight the next general election as 2.5/1

She's toast...

Pokerchips,

I already posted that info to this board on Tuesday. Very interesting sector to watch..

Optimism is a great personal quality however as an investor it can be a dangerous. A dose of realism is needed. Currently there's no profitability in Ocado retail. Every chance of losses incurred in future and market share declines. Those happier times you refer to are years away in my opinion. Huge costs will eat into Ocado. Still no new overseas contracts...

Carrington,

Again like chilting you are looking at the surface of the numbers. It's only when you dig deeper do you see the huge runup of costs Ocado Retail is currently incurring. Ocado Retail has spent tens of millions increasing their capacity over the last year and still they have exactly the same market share. Huge costs incurred in overestimating the capacity Ocado retail needed. These costs are undermining their profitability to the extent that there was none for Ocado retail last quarter. This extra capacity will remain hanging over the operation for many months incurring yet further great cost.

You keep saying you are tempted to buy, why don't you buy some? Chilting believes the stock is a no brainer investment. It should be very profitable for you...

Chilting,

Smaller basket sizes greatly deplete the profitability of Ocados tech grocery delivery model. Ocado retail have held market share at an enormous economic cost having vastly overestimated the capacity needed for the operation. You are positive on a recovery. Personally I see the opposite. The excess capacity cost overhang I can see remaining for many, many months...

JJ,

The problems at Ocado retail run a lot deeper than the marketing campaign not being up to scratch. Personally I think their marketing is good. They've run a few TV campaigns this year, increased promotions and notifications on the Ocado app. Sensible stuff to try and trigger consumers to buy more.

Key issue is though is that consumers in this cost of living crisis are currently laser focussed on price. Ocado retail is expensive compared to the grocers the public are moving towards, discount grocers etc. Even versus online grocers, Tesco for example, Ocado retail is still expensive.

The trend outlined by Ocado retail in its last quarterly statement of its customers seeking out cheaper lines of goods and ordering smaller baskets is very detrimental to any profitability of the Ocado model. This trend I believe will intensify rather than resolve itself in the months ahead...

Chilting,

You could read the Kantar figures for Ocado as you have done in a positive light. Look under the bonnet though and you will see that this static market share is extremely disappointing. Over the last year Ocado retail have built out a 30%+ capacity increase across their operations. No other grocer on the Kantar list has spent so much on an operational increase as Ocado. They have opened new CFCs large and small. This has been done at great cost, the CFCs built out harnessing the latest technology available at build time. This massive ramp up of capacity was carried out in response to the perceived hugely increasing demand. In reality the demand has dropped off hugely leaving Ocado with very expensive CFC over capacity.

Currently Ocado retail is not making any profit. In the months to come I believe it will be shown that Ocado retail is incurring overall losses due to the capacity overbuild...

As anticipated in my earlier posts consolidation is occuring in the rapid grocery delivery market. Strong competitors to the grocery industry will emerge as less efficient players fall away and bigger companies buy out nimble competitors.

Getir set to buy out gorillas...

https://www.bloomberg.com/news/articles/2022-10-10/delivery-startup-getir-is-said-in-advanced-talks-to-buy-gorillas

Your article is an opinion chilting. Many think the opposite. With OPEC aligning with Russia one thing is for sure. Russia will do all they can do damage their enemies in the West...

Best of luck to you Ragge however I believe you are gravely underestimating the effect of the current economic crisis on Ocado.

Yes there are those CFCs planned and in construction around the world. The build of which Ocado themselves are mostly paying for. In the main Ocado tech grocery partners start paying Ocado fees when the CFCs are built out. Reasonable to assume the CFC builds are a lot more costly than previously planned as inflation will be ramping up every cost within the build.

The tech side of the business has not signed a new technology customer since Ocados new technology was unveiled early this year. More deals may come however when and the scale of new partners is very, very unclear. The future is cloudy. The trends behind Ocado retails woes will be replicated at Ocado solutions overseas cfcs elsewhere. Lower sales as the worldwide recession begins. Customers seeking out lower priced goods, ordering smaller baskets...

You brought up the Tesco profit issue Pokerchips. Ocados problems run deeper than Tesco's as is obvious for most to see...

Tescos profits are down to £1.2bill but they are proving far more resilient in this cost of living crisis than Ocado retail who are not making any profit currently...