SHARE OF THE WEEK: Ocado set to reveal festive trade figures

Ocado will shine a light on changing shopping habits when it announces its trade update for the all-important holiday season on Tuesday.

Investors are hoping for more Christmas cheer after great figures from Tesco and M&S, among others, in recent days.

But their hopes could be dashed after a challenging year for the online grocer, which has struggled to maintain growth rates as pandemic-fuelled enthusiasm for online shopping wanes and price-conscious shoppers go on a bargain hunt.

Hailed as the ultimate winner of the pandemic, Ocado Retail – a joint venture between Ocado and M&S – saw sales boom as brick-and-mortar retailers shut down.

But the tide turned quickly. Shares of Ocado are down 55 percent in the past year.

On Tuesday, analysts will look at whether customers at Ocado Retail – which sells Ocado and M&S products – are eschewing the more expensive range in favor of cheaper goods.

Updates on the retailer’s tech department will also be in the spotlight, including the rollout of microsites to support Ocado Zoom, the UK’s scheduled one-hour delivery service.

Sophie Lund-Yates, an analyst at Hargreaves Lansdown, said average basket value at Ocado was expected to drop 6 percent. She added: “Due to the difficult circumstances, Ocado expects a small revenue decline for the full year and close to break-even cash profit.”

Investors will be eagerly awaiting the update after fellow online retailer Asos saw sales drop 8 percent over Christmas.