UK&I Daily Focus: Friday, 19th June 2026

Research evidence excerpt

UK&I Daily Focus: Friday, 19th June 2026

Deutsche Bank

Research

Europe Strategy Date

19 June 2026

UK&I Daily Focus Periodical

Friday, 19th June 2026

Jonathan Jayarajan

TOP STORIES Associate Director Equity Research - EMEA

TESCO (TSCO.L) - Profitability on track Products

Benjamin Yokyong-Zoega: Tgt 525p. Last Close 452.40p, Buy. Tesco remains on +44-20-754-76037

track to deliver EBIT towards the upper end of guidance. This was a noisy 1Q period Andy Chu, FCA

but, despite the softer start to LFL trading, there was a reassuring message from Deputy Head of EMEA Equity Research

management on profit and cash. Strategically, below-market inflation supported +44-20-754-11360

volume outperformance and improving customer satisfaction. Incremental margin

levers are bearing fruit with strong growth in retail media, 15% insurance policy

growth and growing mobile penetration. We view Tesco as a high[1]quality multi-

year compounder. The full impact of inflation is yet to feed through to the UK

consumer, but we see Tesco as well-positioned for relative outperformance given

its leading scale and defensive qualities. The stock trades on 15x Cal-26 PE and

6.5% FCF yield. Our unchanged 525p TP implies c.15% upside. Reiterate Buy.

Figure 1: Table of Contents

UK ECONOMIC NOTES - BoE Recap: A steady hand

Leading Stories Page 01

Sanjay Raja: As expected, the Bank of England kept Bank Rate steady at 3.75% – Company Update Page 01

in line with our call and market expectations. The MPC may, on paper, be more Sector Updates Page 02

divided than in April – but there is a stronger consensus to keep Bank Rate on hold Source : Deutsche Bank

for now. Two members (Pill and Greene) opted for a rate hike, as we expected. But

we think there is a growing consensus for a long hold given the more favourable