Ocado drops on concerns about international deal

Ocado shares dipped on the back of a note from Barclays, saying it is struggling to have “sufficient faith in an imminent international deal” to justify upgrading the stock.

The bank said Ocado isn’t the only option for grocers wanting to build an online business.

“Having said this, we are very sympathetic to Ocado’s view that it is offering a much more comprehensive solution and that many retailers will prefer to fully ‘own’ their customer relationships.”

Barclays said while the company remained confident, the reality is there wasn’t a deal in 2015 and there is no evident timeline.

“Although we expect that the signing of a deal with a credible partner would be a considerable boost for sentiment, we are also a little wary of assuming that this would answer all the market’s doubts.”

The bank retained its ‘equal weight’ rating but cut its target price from 420p to 290p.

Shares in Ocado had dropped 15.7p (6.06%) to 243.30 at 1520 GMT.