Broker snap: Sainsbury an alternative to troubled Tesco, says Galvan

13th Apr 2012 11:09

Sainsbury is continuing to benefit from the woes of supermarket rival Tesco, according to Galvan Research and Trading, which this morning recommended investors to buy the stock."On March 21st, supermarket Sainsbury added to the goodwill created by its record breaking Christmas performance, and positive comparison with ailing rival Tesco, by beating the market again," said Galvan's head of research, Andrew Gibson.Like-for-like sales growth in the 10 weeks to March 17th was 2.5% (2.6% excluding fuel), better than the 2.1% that the market was expected. Meanwhile, the company said that convenience, online and non-food operations were all performing better than market expectations."Galvan Research regards Sainsbury as a buy, not only based on the outperformance seen in the past two quarters - especially in terms of like for like sales growth - but as the obvious sector alternative to troubled Tesco as the number one player struggles to maintain growth momentum," Gibson said.The broker expects the stock to reach its 2012 intraday high of 320p.BC