Tesco: Upgrade To Buy On Improved Fundamentals And Cheaper Valuation

  • Upgraded Tesco (TSCDY) to a buy rating due to improved fundamentals and attractive valuation, despite conservative FY26 guidance. Strong cost management and pricing strategy led to 8.6% y/y net income growth and increased market share in FY25. Retail media and data monetization efforts are scaling rapidly, potentially boosting earnings with high-margin revenue streams.