J Sainsbury PLC (LSE:SBRY)’s acquisition of 10 former Homebase stores is great news, not just for the estimated 1,000 new employees, but for Britain’s second-largest grocery store’s bottom line.
“The deal, which we warmly welcome, is consistent with the strategy set out in its 2024 Capital Markets Day,” noted Shore Capital markets analysts.
Sainsbury’s intends to convert the stores into new supermarkets and while Shore Cap does not expect they to be earning accretive in the current 2025 financial year, “this handy bolt-on should nicely feed into FY26 and beyond, signalling the growing capability and confidence of Sainsbury in the UK grocery arena”.
“Shareholders should, in our view, be pleased with this work,” analysts added.
“We have been very impressed by the advancement of the Sainsbury grocery proposition under Simon Roberts' tutelage, manifested in profit progress and share gains.
“We feel that the performance of the business has earned management the right to seek to build its platform in the UK, recent work on formats, merchandise and assortment bringing fresh ideas to good effect.”
Sainsbury’s shares added 0.35% on Thursday.