Tesco (lon:tsco)
Tesco Has Its Customer Base Stabilised?

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Title: Tesco Has Its Customer Base Stabilised?
Company: TSCO - Tesco
Share Price Then: 176p
Author: Ian Smith
Date: Mon 14 Aug 2017
Comments: Tesco has had years of an overvaluation, with a P/E ratio for 2017 of 28 you can easily argue that there is another 50% or 100p to come off the share price.

Even a drop that big would still leave them safely in FTSE 100, the last time that I checked Tesco would need to drop to 50p to fall out of it.

Everyone will have read about Tesco's woes but where are they now, are they now a buy for someone following the market closely?

I suspect that by now most people who are going to try Aldi/Lidl will have done so and either become converts or come back, it doesn't seem likely that many customers will buy some items in Aldi/Lidl and others in Tesco.

It is simply too much hassle, if you are totally price orientated what is there in Tesco that is not in Aldi/Lidl? if you are less price conscious is there in Lidl/Aldi to make it worth the effort to save a few pounds on the items that they have in common?

If you look at the current product range it seems that Tesco may have decided to accept the loss of some customers to Aldi. How long has it been since anyone saw the Blue and White Basics range?

Whether these were ever sold at below production cost I don't know but it would be surprising if they yielded a useful profit, especially if you add in the cost of the person on the checkout.

It is easy to support a view that says the loss of turnover that contributed too little to profit is a good idea.

However I am concerned that Tesco are going too far in reducing their product range, product size and quality as personally I have started going back to shopping in multiple locations, " that local pie maker in the market, followed by the cheese shop and ...."

Just using Tesco for washing powder, tea bags and bottles of squash, products which as are too heavy to carry around town or are not easily available.

I am wondering if there is now a space in the market, a shop where Tesco was 10 years ago!
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