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Tesco

TSCO.L
44
Grocery Stores · Consumer Defensive
Exchange
London Stock Exchange
Winston Score
44
Winston is serious
Mixed quality — meaningful strengths and weaknesses.
Data as of Aug 23, 2026 · filings through Feb 28, 2026
How the score breaks down
Quality
Mixed
Growth
Mixed
Cash Flow
Strong
Stability
Good
Valuation
Mixed

Winston Score History

The full picture

Tesco is one of the largest supermarket chains in the world, selling groceries, household goods, clothing, and financial services to everyday shoppers. It operates thousands of stores across the UK and Ireland, ranging from large out-of-town hypermarkets to small convenience shops under the Express banner. Tesco is the biggest grocery retailer in the UK by market share.

Tesco makes most of its money from in-store and online grocery sales, but also earns revenue through its Clubcard loyalty program, Tesco Bank, and its wholesale arm Booker, which supplies restaurants and corner shops. The company operates primarily in the UK and Ireland, with a smaller presence in Central Europe. Its Clubcard data gives it an advantage in targeted promotions and supplier negotiations, but thin grocery margins mean any cost pressure — from wages, energy, or food inflation — can quickly squeeze profits.

Growth Profile

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+7.2% YoY

YoY Growth Rate

Slow revenue growth

EPS Growth

+51.7% YoY

YoY Growth Rate

EPS growth accelerating

Insider Activity

2.4%ownership

Declining

Insider ownership declining — could be dilution or selling

Cash Position

Cash flow positive

£6.1B cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Company generates more cash than it spends — no dilution risk from fundraising

Growth context

Tesco is growing revenue at 7% year-over-year. The Winston Score measures business quality today — these growth metrics show what could matter tomorrow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Profit per sale
Gross Margin
7.3%
Thin — 7.3% gross margin
Profit after running costs
Operating Margin
4.0%
Thin — 4.0% operating margin
Return on the money invested
ROCE
16.6%
Strong — 16.6% return on capital

ROIC between 15% and 25%. Every dollar invested in the business earns 15 to 25 cents back per year.

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Growth

Sales growth
Sales YoY
+5.4%
Slow sales growth (+5.4% YoY)
Profit growth
EPS YoY
+14.6%
Earnings growing (+14.6% YoY)

Healthy double-digit earnings growth — what compounders look like.

How steady the profit is
EPS Consistency
4/8 quarters
Earnings inconsistent quarter-to-quarter

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Cash Flow

Profit that turns into cash
Cash Conversion
225%
Turns 225% of profit into real cash
Spare cash per sale
FCF Margin
3.6%
Thin free cash flow (3.6%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

What it owes vs what it owns
Debt / Equity
0.63
Moderate — manageable debt (0.63)
Covers its interest
Interest Cover
4.03x
Adequate interest coverage (4.0x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

Price vs profit
P/E Ratio (TTM)
16.9x
no trend
Fair value — P/E 16.9

P/E in the normal range. Price is roughly $15 for every $1 of yearly profit.

Cheaper or dearer next year
P/E vs Forward
N/A
not available
Data not available

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Dividends

Not applicable for this business.
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