Online sales at the supermarket soared by 60% for the week ending January 11, compared with the same period of last year. Weekly sales climbed by 5.4%, which was “encouraging for the UK grocery sector”, said analysts Clive Black and Darren Shirley.
While cautioning against attributing too much significance to one week’s data, the analysts said: “We continue to believe that Waitrose remains more of a threat than virtue for Ocado, the shares of which remain too highly rated for our comfort.”
‘Waitrose is at its core sore and dis-satisfied’
Waitrose is a growing direct competitor, particularly in London and the south-east of England, they argued. “There remains considerable scope for Ocado to lose its key business partner within the next three years; we still believe that Waitrose is at its core sore and dis-satisfied by Ocado's tie-up with Morrisons.”
Shore Capital also noted that despite “all the hullabaloo about the progress of the hard discounters”, Waitrose had outperformed the UK grocery industry for some years now, thanks to its high-quality fresh food, own-label and distinctive brands as well as increasingly competitive everyday lines.
Ocado yesterday (January 16) reported gross sales growth of 20.1% for the 16 weeks to December 1 2013.