Ocado, Once Europe’s Top Short, Battles to Sustain Share Rally

(Bloomberg) -- Ocado Group Plc shares will be seeking a fresh catalyst when the online grocer releases a sales update on Tuesday.

After surging in the first half of the year on a flurry of international technology licensing agreements, the stock has retreated from its July peak on a lull in newsflow since May’s announcement of a landmark deal with Kroger Co.

With Ocado now viewed as much as a technology company as it is an online grocer, greater significance will be placed on news of any advances with the company’s so-called smart platform and progress on pacts with supermarket chains, according to Peel Hunt analysts. With the stock having gone from being Europe’s most-shorted stock to among its best share price performers, regular fuel is needed to sustain the stock’s momentum.

Ocado, Once Europe’s Top Short, Battles to Sustain Share Rally

Among investors that have taken profits are Linic Ltd., which has sold 14.29 million Ocado shares for 127.4 million pounds ($167 million) this year. Activist investor Crystal Amber realized a profit of 8.3 million pounds by selling its holdings, according to a stock exchange filing this month.

Ocado, Once Europe’s Top Short, Battles to Sustain Share Rally

At least short sellers have been kept at bay. Bearish wagers have tapered to 3.3 percent of shares outstanding as of Sept. 13, compared with more than 20 percent in June 2017 when Ocado was the most-shorted stock in the Stoxx Europe 600 Index, according to data compiled by IHS Markit Ltd.

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