Tesco PLC (LSE:TSCO) is expected to report a strong end to 2023, according to analysts at stockbroker Jefferies.
The investment banking firm painted a picture of a "cool, calm and collected" grocer that has entered the new year on a "sure footing", in its latest analysis of the company on Thursday.
Analysts at the bank are predicting that Tesco could beat expectations for the latest fiscal year.
Analyst modelling suggests Tesco could deliver £2.76 billion of earnings before interest and taxes (EBIT) for the fiscal year 2023/4.
This would be more than its current EBIT guidance for between £2.6 billion and £2.7 billion, and even the strong market consensus of £2.72 billion.
Jefferies analysts said that the broader competitive context should support “solid earnings progress” for the supermarket, which they believe is “undervalued”.
Analysts at the investment banking services firm predict that Tesco's share price could rise by almost a fifth to 350p, where they see fair value, an approximately 17% premium compared to today's trading price of 301.96p.
Tesco is expected to release its latest financial results for the recent quarter and festive trading period next Thursday.