May 19, 2018
Ocado delivers for 'patient' investors
Thursday's announcement of a deal with US retail giant Kroger sent the share price soaring as much as 80%, as the value of Ocado rose billions of pounds and it overtook Marks & Spencer in stock market size. It's the fourth such international agreement Ocado has reached in six months, but the biggest so far given the size and potential of the US retail market. Says Laith Khalaf, senior analyst at Hargreaves Lansdown: "The threat of a big disruptor [Amazon] entering the sector puts pressure on food retailers to be on top of their game when it comes to online deliveries, and that's where Ocado comes into its own." "Ocado is a business that delivers a good service for customers but not for shareholders," said Shore Capital analyst Clive Black in 2012.Patient investors. The retail analyst predicted success would come to Ocado much as it had in the past 12 months, through exclusive contracts to build tech-heavy distribution warehouses for leading retailers.
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