Ocado Group reported 13% revenue growth and GBP 40 million adjusted EBITDA improvement in the first half of fiscal 2025, beating consensus and leading to a 14% rise in shares. The company aims to become cash flow positive by fiscal 2026, with a 109% and 11% year-over-year adjusted EBITDA growth for its technology and logistics businesses, respectively. Our fair value estimate for Ocado Group is raised to GBX 300 from GBX 231, as we expect increased profitability and cost reductions by 2027. Despite being a leader in online fulfillment, competition is intensifying, and execution risks exist for Ocado, which we still view as a no-moat business.

Read more at Morningstar: Investor Confidence Boosted With Cash Flow and Profitability Uplift