In key news on UK stocks, Ocado Group (GB:OCDO) expanded its partnership with Japan-based AEON Co. (JP:8267) to build a new robotic warehouse. This warehouse, scheduled to be opened in 2027, will be Ocado’s third customer fulfillment centre in Japan. Following the announcement, Ocado shares gained nearly 6% as of writing, whereas Aeon stock traded down by 1.32%.
Ocado Group is a technology-centric company known for its expertise in software and robotics platforms. The company also operates in the logistics and retail business. Meanwhile, AEON Group manages companies operating supermarket chains and shopping centers.
More About Ocado-AEON Partnership
Ocado and AEON initially signed an exclusive partnership in 2019 to enhance the online operations of the AEON NEXT grocery business through the Ocado Smart Platform (OSP). The first warehouse was launched in July 2023, with plans for the second center to commence operations in 2026.
As per the announcement, AEON will adopt the latest Ocado technologies, upgrading all current operations with advancements like the On-Grid Robotic Pick (OGRP). This will lead to enhanced labour productivity, enabling AEON to lower operational costs and handle labour shortage problems in Japan.
In terms of its performance, Ocado Group is projecting a revenue growth of 15-20% for its Technology Solutions segment for FY24. In FY23, revenue from this segment grew by 44.3% year-over-year to £429 million. Additionally, the company expects an adjusted EBITDA margin of more than 10% from this segment.
Ocado will release its first-half results for FY24 next week on July 16.
Is Ocado a Buy, Sell, or Hold?
According to TipRanks’ analyst consensus, OCDO stock has received a Hold rating based on two Buys, five Holds, and two Sell recommendations. The Ocado share price forecast is 515.02p, which is 48.2% above the current price level.
