All eyes are on Australian supermarket giants Coles and Woolworths this week as they release their latest earnings reports. Coles is reporting on Tuesday, followed by Woolworths on Wednesday. According to eToro market analyst Josh Gilbert, Coles appears to have gained a competitive edge after overcoming challenges faced during the COVID-19 pandemic. eToro is a social investment platform that allows users to trade a variety of assets, including stocks, cryptocurrencies, and commodities. Josh Gilbert provides market analysis on companies listed on the stock market.
Gilbert highlighted Coles’ strong year-to-date performance, noting impressive sales growth and a significant revenue increase, which has driven a 12 per cent rise in its share price. In contrast, he pointed out that Woolworths’ financial performance has been less robust, impacted by industrial action, missed estimates, and declining margins. Gilbert suggested that Woolworths’ $400 million cost-saving initiative, announced earlier this year, might offer some positive signs in the upcoming earnings report.
Despite their differing situations, Gilbert believes both supermarkets are now in a better position for growth compared to last year, with reduced scrutiny related to cost-of-living pressures. Even the ongoing ACCC action concerning alleged sham discounts appears to be of minimal concern to the companies’ leadership. He added that Australian supermarkets, like many businesses, are transitioning from survival to recovery mode.
Gilbert anticipates that this optimistic outlook will be reflected in Coles’ results this week. Investors and analysts will be closely watching both reports for insights into the current state and future prospects of Australia’s leading supermarket chains.
