Ocado Group PLC OCDO

Morningstar Rating
GBX326.20 −2.80 (0.85%)
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Company Report

Ocado’s Solutions Are Not Enough to Earn a Moat

Ocado Group offers exposure to the international e-grocery market. It began as a pure-play e-grocer in the UK and was the first mover in end-to-end automated fulfillment in groceries. In 2015, Ocado saw the opportunity to monetize its fulfillment solutions and began selling the Ocado Smart Platform to other grocers. In 2019, Ocado sold 50% of its e-grocery business, Ocado Retail, to Marks & Spencer. Ocado operates under two segments: solutions, encompassing the Ocado Smart Platform, and logistics, which operates in the UK. Ocado is in the early stages of deploying its technology beyond the e-grocery vertical.

Price vs Fair Value

OCDO is trading within a range we consider fairly valued.
Price
GBX329.00
Fair Value
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Uncertainty
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1-Star Price
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5-Star Price
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Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

We see the Ocado Smart Platform as one of the most reliable online fulfillment solutions for the grocery market currently.

Bears

There is considerable execution risk involved in rolling out committed CFCs for Ocado’s partners over the next few years.

News

Trading Information

Previous Close Price
GBX329.00
Day Range
GBX324.80–338.20
52-Week Range
GBX140.30–355.00
Bid/Ask
GBX220.00 / GBX0.00
Shares Outstanding
836.58M
Market Cap
GBX272.89B
Volume/Avg
2M / 3M

Key Statistics

Price/Earnings (Normalized)
—
Price/Sales
1.73
Dividend Yield (Trailing)
0.00%
Dividend Yield (Forward)
0.00%
Dividend Payment Schedule
—
Total Yield
—

Company Profile

Founded in 2000, Ocado provides automation and logistics solutions to grocers. Ocado operates in two segments: logistics and solutions. Logistics provides fulfillment and delivery services in the United Kingdom. Solutions is based on the Ocado Smart Platform, a modular, automated online retail fulfillment and delivery solution that provides software, fulfillment hardware, and support services to corporate customers in return for upfront and recurring fees. Partners include leading grocers around the world, like Sobeys, Morrisons, ICA, Groupe Casino, Bon Preu, Kroger, and Coles. Ocado also has a 50% stake in Ocado Retail, a pure-play e-grocery business. The other 50% is owned by Marks & Spencer.
Sector
Consumer Defensive
Industry
Grocery Stores
Stock Style Box
Small Value
Total Number of Employees
21,426

Competitors

Valuation

Metric
OCDO
TSCO
AMZN
Price/Earnings (Normalized)
—17.5734.97
Price/Book Value
1.842.894.89
Price/Sales
1.730.463.51
Price/Cash Flow
13.178.8714.22
Price/Earnings
OCDO
TSCO
AMZN

Financial Strength

Metric
OCDO
TSCO
AMZN
Quick Ratio
1.350.400.87
Current Ratio
1.410.621.03
Interest Coverage
−0.514.1752.28
Quick Ratio
OCDO
TSCO
AMZN

Profitability

Metric
OCDO
TSCO
AMZN
Return on Assets (Normalized)
−4.92%5.05%10.39%
Return on Equity (Normalized)
−13.50%17.80%20.90%
Return on Invested Capital (Normalized)
−3.78%9.18%14.69%
Return on Assets
OCDO
TSCO
AMZN

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