After reading the latest Tesco news and seeing their reported 6.4 billion pounds in losses I am glad I stuck to my gut instinct on this one. Sometimes it is funny how you get a bad feeling about a company and at the time you cannot see why but it becomes apparent a year or two down the line. From what I have read and been told these past few weeks it is all doom and gloom for Tesco and as a result I can only see their share price going one way and that is down. I like companies with some form of growth and the fact that their stores. If company profits are at record lows dividends are likely to fall too and therefore this would not be a company I would want to invest my hard earned cash in.
I guess some people may hope that Tesco can turn it around and will be hoping to pick up a bargain as their share price drops. Right now the live Tesco share price is 224 pence (this is of 13.30 24th April). It was as low as 155 pence back in December and over 300 pence in May of last year. I cannot see it getting close to 300 pence again for some time. Decreasing profits and shop closures is very bad news for this company.
How can Tesco turn it around? I guess they can hope the price of their individual premises rises and their sales soar but hope gets you nowhere, action is needed. They need to concentrate on promoting their profitable stores and getting rid of their poorly performing stores. Some research needs to be done to find out why some stores perform well and others perform poorly, for example are the poor performers in areas with other high competition stores like Lidl or perhaps they have a unfavourable location away from major residential areas. I do wish Tesco all the best but for now I will stay clear of this supermarket stock.