Ocado lost a fifth of its value yesterday in its biggest sell-off for more than a decade.
On a brutal day for investors, the stock fell 19.9 per cent, or 160.6p, to 647.8p after a leading analyst resumed his negative view.
The plunge wiped nearly £1.4billion off the online supermarket group’s value – shaving £32million off the stake held by co-founder and chief executive Tim Steiner.
The rout, the biggest for 11 years, followed a note from BNP Paribas Exane analyst Andrew Gwynn in which he downgraded the outlook for the stock.
Ocado was among the lockdown winners, with its share price hitting a record 2895p in September 2020. But it dropped as low as 343p in June this year.
Crash: On a brutal day for investors, Ocado stock fell 19.9%, or 160.6p, to 647.8p after a leading analyst resumed his negative view
The stock has rallied in recent weeks and was trading above 800p before yesterday’s sell off.
In his note, Gwynn downgraded his recommendation to ‘underperform’ from ‘neutral’, explaining that the recent rally had left the risk-versus-reward ‘out of kilter’. The note added the stock ‘seems now to be out of kilter again’.
Ocado had enjoyed a strong start to the week, with upbeat notes from analysts at Jefferies and JP Morgan then positive results from its online shopping joint venture with Marks & Spencer.
The report from Ocado Retail on Tuesday showed customers were once again buying more goods after a string of price cuts won back middle-class shoppers.
Sales over the three months to August 27 were 7.2 per cent higher than 12 months earlier at £569.6million.
