Sainsbury’s Q1 earnings preview: where next for Sainsbury’s shares?

Sainsbury’s releases a quarterly update this week that will reveal how sales have fared since the wider economy, including restaurants and pubs, reopened in April. We explain what to expect as interest in the UK supermarket sector rises.

Charts (4)

When will Sainsbury’s release Q1 results?

Sainsbury’s will release first-quarter results on the morning of Tuesday July 6. This will cover the three months since the end of its last financial year on March 6.

What to expect from the Sainsbury’s results

Sainsbury’s quarterly updates only focus on sales growth and don’t usually provide hard revenue figures. While evidence suggests that grocers have continued to benefit from strong growth even as restaurants, pubs and other venues have reopened as lockdown eases, Sainsbury’s has warned it will be coming up against strong comparatives from last year when demand exploded as the pandemic erupted.  

Still, the latest data from Kantar suggest Sainsbury’s delivered 10.2% sales growth over the 12 weeks to June 14, reported to be driven by its strong online offering and its convenience stores and giving an idea of how it performed. Still, that trailed the 12.1% growth at Tesco and the 10.5% growth at Morrisons but was ahead of Asda’s mild 6.3% rise in sales.

Notably, Tesco, the UK’s largest supermarket, has set the tone after publishing its first-quarter results last month covering a slightly different timeframe of the three months to May 29. The company said like-for-like sales were up 8.1% compared to pre-pandemic levels, implying demand has remained strong even as the wider economy reopens, but was only up 1% from the previous year as strong comparatives came into play.

Investors should also watch for any adjustments made to the outlook. Sainsbury’s said earlier this year that it agreed with the consensus among analysts that it can deliver underlying pretax profit of around £620 million in the current financial year. That would compare to the £356 million delivered in the last financial year and the £586 million booked the prior year before the pandemic hit.

Beyond that, Sainsbury’s update is likely to focus on how it is progressing with its new plan introduced last November. This is seeing the supermarket invest in its product range and online offering, build on the potential of its Nectar loyalty programme, transforming Argos into a leaner business with a wider catalogue of goods, rebuilding its home brand Habitat and cutting costs across the group.

The update comes as interest In the UK supermarket sector heats up following the bidding war that has started for Morrisons. Having turned down a £5.5 billion offer from Clayton, Dublier & Rice last week, it has now accepted a £6.3 billion offer from a rival consortium of investors, who are keen to tap-into Morrison’s large freehold property estate and supply chain that sees it make more of its own food compared to its rivals. With another private equity group, Apollo, also stating that it could be the third firm to make an offer for Morrisons, there are signs that the strong appetite for the sector could look at other players in the market if they are unable to snap-up Morrisons.

Where next for the Sainsbury’s share price?

Sainsbury’s has been trending higher since late September. It trades above its 50 & 100 sma on the daily chart and above its multi-month ascending trendline showing an established bullish trend. 

The RSI is supportive of further gains whilst it remains out of overbought territory, after which some consolidation or an easing back in the price could be on the cards. 

Immediate resistance can be seen at 280p a level last seen on early 2019, followed by 300p the round number and a level also from early 2019.  

It would take a move below 250p for the near-term uptrend to be negated and a move below 245p the 100 sma and ascending trendline could see sellers gain traction towards 235p.

How to trade Sainsbury’s shares

You can trade Sainsbury’s shares with City Index by following these four easy steps:

  1. Open a City Index account, or log-in if you’re already a customer.
  2. Search for ‘Sainsbury’s’ in our award-winning platform
  3. Choose your position and size, and your stop and limit levels
  4. Place the trade 

More from Equities


This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit for the complete Risk Disclosure Statement.