TSCO:LSETesco PLC Analysis
Data as of 2026-05-20 - not real-time
£459.70
Latest Price
5/10Risk
Risk Level: Medium
Executive Summary
Tesco PLC trades at a price that sits below analyst median targets but above the discounted cash‑flow fair‑value estimate, suggesting a modest discount to consensus expectations.
The 14‑day RSI is comfortably below the 50‑level, flagging oversold conditions that could support short‑term upside, while the MACD histogram remains bearish, indicating lingering downside momentum. Volume has been stable and the 30‑day price volatility is elevated, reflecting a market that is pricing in uncertainty despite the defensive consumer‑staple sector. The dividend yield of roughly three percent, coupled with a payout ratio under 60 % and strong free‑cash‑flow generation, underpins the sustainability of the income stream. Together, these metrics paint a picture of a stock that is fundamentally solid, modestly undervalued relative to analyst targets, but subject to short‑term technical headwinds.
The 14‑day RSI is comfortably below the 50‑level, flagging oversold conditions that could support short‑term upside, while the MACD histogram remains bearish, indicating lingering downside momentum. Volume has been stable and the 30‑day price volatility is elevated, reflecting a market that is pricing in uncertainty despite the defensive consumer‑staple sector. The dividend yield of roughly three percent, coupled with a payout ratio under 60 % and strong free‑cash‑flow generation, underpins the sustainability of the income stream. Together, these metrics paint a picture of a stock that is fundamentally solid, modestly undervalued relative to analyst targets, but subject to short‑term technical headwinds.
Market Outlook
Short Term
< 1 yearNeutral
Model confidence: 6/10
Key Factors
- RSI below 50 indicating oversold conditions
- Bearish MACD histogram suggesting downside pressure
- Stable volume and high short‑term volatility
Medium Term
1–3 yearsPositive
Model confidence: 7/10
Key Factors
- Price below analyst median target but above DCF fair value
- Defensive consumer‑staple sector with low sector risk
- Sustainable dividend yield supported by strong free cash flow
Long Term
> 3 yearsPositive
Model confidence: 8/10
Key Factors
- Undervalued relative to consensus targets
- Low sector and regulatory risk in a stable geography
- Attractive dividend yield and solid balance‑sheet metrics
Key Metrics & Analysis
Financial Health
Revenue Growth7.20%
Profit Margin2.42%
P/E Ratio17.0
ROE15.46%
ROA4.93%
Debt/Equity131.62
P/B Ratio2.8
Op. Cash Flow£3.9B
Free Cash Flow£2.2B
Technical Analysis
TrendNeutral
RSI43.6
Support£445.30
Resistance£497.25
MA 20£472.72
MA 50£474.72
MA 200£451.93
MACDBearish
VolumeStable
Fear & Greed Index89.18
Valuation
Fair Value£451.75
Target Price£515.36
Upside/Downside12.11%
GradeUndervalued
TypeValue
Dividend Yield3.14%
Risk Assessment
Beta-0.05
Volatility26.97%
Sector RiskLow
Reg. RiskMedium
Geo RiskLow
Currency RiskLow
Liquidity RiskMedium
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This analysis may contain inaccuracies and is provided for informational and research purposes only. It is not personal investment advice, a recommendation, or an instruction to buy, sell, or hold any asset.