Tesco PLC (LON: TSCO) heads into the key Christmas trading period with its share price hovering just below recent highs, a hefty share buyback underway and analysts broadly positive but no longer screaming “bargain”.
As of the session on 8 December 2025, Tesco shares trade around 452p, compared with a previous close of 453p, within a 52‑week range of roughly 310p to 480p. [1] After a strong run in 2025, the stock now sits only a few percentage points below its November peak.
Below is a detailed look at the latest price action, corporate news, earnings, dividends and analyst forecasts that matter for Tesco shareholders and watchers today.
Tesco share price today (8 December 2025)
Data from Investing.com and Tesco’s own investor pages show Tesco trading at about 451.9p on 8 December 2025, with an intraday range of roughly 451.1p–453.4p. [2] MarketWatch notes that on 3 December 2025 the shares closed at £4.51, about 6.2% below their 52‑week high of £4.81, reached on 11 November 2025. [3]
Performance highlights from recent commentary and data providers include:
- Year-to-date 2025: Around +20–25%. The Motley Fool reports Tesco shares are up about 23% year to date as of early December, [4] while a dividend-focused tracker puts the YTD move closer to +27%, depending on the exact start date used. [5]
- Last 12 months: One recent article notes the share price is up around 20% over the past year and about 97% over three years, underscoring how strong the multi‑year recovery has been. [6]
- Momentum: MarketBeat reports that on 5 December 2025 the shares moved above their 200‑day moving average (around 425p), trading as high as 455.1p and closing around 452p on volume of more than 12 million shares. [7]
In short, Tesco has already delivered what many investors would consider two or three “normal” years of returns since 2023, which inevitably colours the debate about upside from here.
Latest stock news: buybacks, Christmas push and store expansion
Aggressive £1.45bn share buyback continues
Tesco’s most visible shareholder‑friendly move in 2025 has been its large £1.45 billion share buyback programme, announced in April and scheduled to run through April 2026. [8]
Key recent developments:
- An RNS on 5 December 2025 disclosed that Tesco repurchased 3,431,529 shares on 4 December at an average price of 453.18p, with the shares to be cancelled. That takes the shares in issue down to roughly 6.416 billion. [9]
- The same notice shows that, since the programme’s launch on 10 April 2025, Tesco has bought back about 320.8 million shares for £1.31 billion, leaving some headroom before the full £1.45 billion target is reached. [10]
- A new note from TipRanks on 8 December 2025 highlights another tranche of around 2.7 million shares purchased for cancellation and reiterates that the buyback is explicitly framed as a way to “enhance shareholder value”. [11]
For shareholders, the combination of buybacks and dividends means a very high “total yield”: Fidelity estimates a 2025 dividend yield of about 3.2% and a buyback yield near 4.7%, roughly 7–8% of Tesco’s market value returned to investors over the year. [12]
Betting on a strong Christmas
The big near‑term question is how Tesco performs over Christmas.
At its Interim Results 2025/26 in October, Tesco raised its full‑year profit guidance to £2.9–3.1 billion in adjusted operating profit, up from the £2.7–3.0 billion range given earlier in the year, and CEO Ken Murphy explicitly said the group was “betting on a good Christmas” as it gains share while investing in price and service. [13]
Operationally, Tesco has been:
- Opening new large-format stores, such as a new superstore in Harrogate, due to open on 9 December 2025. [14]
- Running highly visible seasonal campaigns, including giving away “perfectly imperfect” Christmas trees to highlight value and sustainability. [15]
- Joining other retailers in closing larger stores on Boxing Day, a move framed as a staff‑friendly decision that also slightly compresses the peak trading window. [16]
Macro conditions are mixed. UK shop‑price inflation cooled to 0.6% in November, with food inflation down to around 3%, the lowest fresh-food reading since 2020. [17] That eases pressure on consumers, but the British Retail Consortium warns that labour and tax costs rising in 2026 could put renewed pressure on retailers’ margins. [18]
Beyond groceries: financial services tie‑ups
Tesco has also been nudging its brand further into financial services:
- In August 2025, Aviva and Tesco Insurance and Money Services announced a new life insurance partnership, combining Aviva’s underwriting and Tesco’s customer reach. [19]
This is unlikely to move the profit dial near‑term, but it supports Tesco’s strategy of deepening customer relationships via Clubcard‑linked financial products.
From profit warning to upgraded guidance: Tesco’s 2025 earnings story
2025 has been a year of narrative whiplash: a spring profit warning, strong trading updates through the year, then an autumn guidance upgrade.
April 2025: profit warning and price war fears
In April 2025, Tesco shocked the market by warning that adjusted operating profit for the year ending February 2026 would likely fall to £2.7–3.0 billion, from £3.13 billion in 2024/25, largely because of intensifying price competition and higher labour and tax costs. [20]
- Reuters reported that the stock dropped more than 7% on the day, hitting a nine‑month low. [21]
- The company explicitly referenced Asda’s pledge to cut prices, and analysts framed the move as Tesco pre‑funding a price war while announcing the £1.45bn buyback to soothe investors. [22]
June 2025: Q1 trading – strong like-for-like growth, guidance unchanged
By June 12, 2025, the tone was already improving. In its Q1 2025/26 Trading Statement, Tesco reported: [23]
- Group like‑for‑like sales (ex‑fuel) up 5.5%.
- UK like‑for‑like sales up 5.1%, with UK market share up to 28.0%, marking 24 consecutive four‑week periods of share gains.
- Online sales up 11.5%, increasing online market share by about 1.6 percentage points.
Guidance stayed at £2.7–3.0bn of adjusted operating profit, but management pointed to rising customer satisfaction, strong performance of own‑brand ranges and continued price investments as setting up Tesco for long‑term growth. [24]
October 2025: H1 2025/26 – upgraded outlook and higher dividends
The Interim Results 2025/26 in early October confirmed that the strategy was working: [25]
- Group sales (ex‑VAT, ex‑fuel) rose 5.1% year‑on‑year to £33.1bn.
- Adjusted operating profit grew to £1.67bn, up about 1.6%.
- Adjusted diluted EPS increased 6.8% to 15.43p, helped by the lower share count from buybacks.
- Free cash flow was a robust £1.3bn.
Importantly for income investors, Tesco:
- Raised the interim dividend12.9% to 4.80p per share, in line with its policy of paying 35% of the prior year’s full‑year dividend at the interim stage. [26]
- Upgraded full‑year guidance to £2.9–3.1bn adjusted operating profit. [27]
At the same time, Tesco’s UK grocery market share has climbed to roughly 28–28.4%, consolidating its lead over competitors. [28]
Dividends, yields and total shareholder return
Tesco has rebuilt its dividend over the past few years and is now firmly positioned as a moderate-yield, high‑cash‑return stock.
Dividend levels
Key recent numbers:
- For the 2024/25 financial year, Tesco proposed a final dividend of 9.45p, taking the full‑year dividend to 13.70p, up 13.2% year‑on‑year. [29]
- The 2025/26 interim dividend was then raised to 4.80p, up 12.9% from the prior interim. [30]
Multiple data providers now put Tesco’s trailing or current dividend yield in the 3.1–3.4% range at today’s share price:
- Morningstar: ~3.15% trailing and forward yield. [31]
- DividendMax: about 3.4%. [32]
- DividendStocks.cash: around 3.17% today, with a three‑year average closer to 3.3%. [33]
- Yahoo Finance commentary refers to a yield of about 3.2% as of early December. [34]
Given the 2025/26 interim uplift, the market is clearly pricing in further dividend growth, though the exact final dividend for 2025/26 will only be proposed with the April 2026 results.
Buybacks boost the “total yield”
Alongside the cash dividend, Tesco’s buyback programme significantly increases the total capital returned to shareholders:
- Fidelity estimates a 2025 buyback yield of around 4.68%, on top of a dividend yield just above 3%. [35]
- Morningstar’s “total yield” figure (dividends plus buybacks) sits around 7.8%. [36]
That level of total yield is high for a large defensive stock, and is one reason some commentators argue that, even after the rerating, Tesco can still deliver respectable high‑single‑digit annual total returns if earnings progress modestly. [37]
Valuation: not a bargain, but not obviously expensive
Morningstar’s latest snapshot shows Tesco trading on a normalised P/E of about 16.5 and a price‑to‑sales ratio of roughly 0.43. [38] That is neither “cigar butt” deep value nor speculative growth; it’s closer to what you’d expect for a dominant, cash‑generative consumer defensive in a mature but still growing market.
The profit‑warning episode in April caused the multiple to compress sharply, but the subsequent recovery in sentiment and guidance has pushed the valuation back towards the upper end of Tesco’s recent range. That’s exactly why the analyst community is now split between “solid compounder” and “fully valued” narratives.
Analyst ratings and Tesco share price forecast
There is now a thick stack of analyst forecasts on Tesco, and they don’t all agree – but most cluster around only modest upside from current levels.
Consensus price targets
Recent datapoints include:
- MarketBeat: average 12‑month price target of 473.75p, based on five analysts, with a range of 440p–500p. From a reference price of 453p, that implies around 4.6% upside. [39]
- TipRanks: average target of 478.13p, implying about 5.5% upside, with its AI “Spark” analyst rating the stock “Outperform”. The latest recorded analyst rating cited by TipRanks is a Buy with a 507p target. [40]
- TradingView: aggregates around 12–16 analysts and shows a consensus target near 476p, with the overall rating skewing to “Neutral” rather than strong buy or sell. [41]
- Fintel: using a broader set of estimates, reports an average one‑year target of 441.15p, which is actually 2.6% below the recent close of 453p – suggesting, on that dataset, a slightly overvalued stock after its run. [42]
An earlier October article framed consensus differently, highlighting a median target around 471–472p, implying roughly 5–6% upside, plus a forecast yield a touch over 3%, combining to a potential total return of about 8–9%. [43]
Ratings: mostly positive
On the recommendation side:
- MarketBeat’s recent alert notes that five sell‑side analysts currently rate Tesco as a “Buy”, with Deutsche Bank lifting its target to 495p and other brokers reiterating positive stances. [44]
- eToro summarises the last three months of broker views as a “Strong Buy” consensus based on four analysts. [45]
- Fintel’s news feed shows Shore Capital, JP Morgan Cazenove and Deutsche Bank all reiterating Buy or Overweight ratings around early October. [46]
The broad picture: few professional analysts are bearish, but many also acknowledge that Tesco’s recent share‑price run limits the scope for huge capital gains without another leg up in profits.
Sector backdrop: slower inflation, online growth and health‑driven demand
Tesco’s prospects are tightly bound to the UK food and grocery market, where trends are evolving quickly.
A recent UK Food & Grocery Markets report (2024–2029) highlights: [47]
- Overall market growth is expected to be “softer” over the next five years, but still positive.
- Food inflation is forecast to fall back to “nominal” levels between 2026 and 2029, with a return to volume growth from 2026.
- The online channel is set to outpace the wider market, supported by investments in fulfilment and rapid‑delivery services.
- Health‑driven choices and demand for a wider range of world foods are key growth drivers, particularly in higher‑margin categories.
Combined with the BRC’s recent data showing shop‑price inflation already down to 0.6% and food inflation around 3%, [48] Tesco seems set to swap the easy tailwind of high inflation for a more “normal” environment where volume growth, mix and efficiency matter more than simple price rises.
As the market leader with roughly 28% share, strong own‑brand ranges and a scaled online operation, Tesco is positioned to benefit – but it also shoulders disproportionate exposure to any renewed price war, regulatory intervention or shifts in consumer behaviour. [49]
Key upcoming catalysts for Tesco stock
Investors watching TSCO should keep an eye on:
- 8 January 2026 – Q3 & Christmas Trading Statement 2025/26
Tesco’s financial calendar flags this as the next major trading update, where the group will reveal how Christmas actually went. [50] - 16 April 2026 – Preliminary Results 2025/26
MarketScreener and Investing.com list mid‑April as the next full‑year earnings release, including the proposed final dividend and any update to medium‑term guidance. [51]
Those two dates will heavily influence whether analyst price targets move up, down or simply cluster around today’s levels.
Opportunities and risks for Tesco shares into 2026
Potential positives:
- Scale and market share: Tesco remains the UK’s dominant grocer, with market share nudging above 28% and evidence of continued gains across 2025. [52]
- Cash returns: A dividend yield around 3% plus an aggressive buyback creates a powerful “total yield” near the high single digits. [53]
- Operational momentum: H1 2025/26 delivered solid like‑for‑like growth, improving EPS and strong free cash flow, allowing the company to upgrade guidance despite cost pressures. [54]
- Structural trends: Growth in online grocery, health‑oriented ranges and world foods plays to Tesco’s strengths in logistics, data and range management. [55]
Key risks:
- Competition and price wars: Asda, Aldi, Lidl and others remain aggressive. The April profit warning shows how quickly expectations can shift when management decides to reinvest in price. [56]
- Cost inflation and regulation: Wage increases, national insurance changes and other policy measures highlighted by both Tesco and the BRC could squeeze margins again in 2026 if not offset by productivity gains. [57]
- Valuation risk: After a 20‑plus percent rise in 2025 and nearly a doubling over three years, the stock is no longer cheap on earnings multiples, and at least one forecast set (Fintel’s) now shows slight downside to its average target. [58]
Bottom line
As of 8 December 2025, Tesco shares sit near the top of their recent range, supported by:
- Upgraded profit guidance,
- A rising dividend,
- A very large buyback, and
- Dominant market share in a stabilising but still competitive grocery market.
Analysts generally expect modest further capital gains plus a 3%‑plus yield, suggesting high‑single‑digit annual total returns if Tesco hits its targets – but not the kind of deep‑value upside that existed a few years ago. [59]
For investors, Tesco now looks less like a turnaround gamble and more like a steady income‑and‑buyback compounder, whose performance in the January 2026 Christmas trading update will be the next big test of whether 2025’s optimism was justified.
References
1. www.investing.com, 2. www.investing.com, 3. www.marketwatch.com, 4. www.fool.co.uk, 5. stocksguide.com, 6. uk.finance.yahoo.com, 7. www.marketbeat.com, 8. www.reuters.com, 9. www.investegate.co.uk, 10. www.investegate.co.uk, 11. www.tipranks.com, 12. www.fidelity.co.uk, 13. www.reuters.com, 14. www.tescoplc.com, 15. www.tescoplc.com, 16. www.thesun.co.uk, 17. www.reuters.com, 18. www.reuters.com, 19. www.aviva.com, 20. www.reuters.com, 21. www.reuters.com, 22. www.ft.com, 23. markets.ft.com, 24. markets.ft.com, 25. www.directorstalkinterviews.com, 26. www.tescoplc.com, 27. www.reuters.com, 28. www.reuters.com, 29. www.tescoplc.com, 30. www.investegate.co.uk, 31. www.morningstar.com, 32. www.dividendmax.com, 33. dividendstocks.cash, 34. uk.finance.yahoo.com, 35. www.fidelity.co.uk, 36. www.morningstar.com, 37. uk.finance.yahoo.com, 38. www.morningstar.com, 39. www.marketbeat.com, 40. www.tipranks.com, 41. www.tradingview.com, 42. fintel.io, 43. uk.finance.yahoo.com, 44. www.marketbeat.com, 45. www.etoro.com, 46. fintel.io, 47. www.globenewswire.com, 48. www.reuters.com, 49. www.reuters.com, 50. www.tescoplc.com, 51. www.marketscreener.com, 52. markets.ft.com, 53. www.morningstar.com, 54. www.directorstalkinterviews.com, 55. www.globenewswire.com, 56. www.reuters.com, 57. www.reuters.com, 58. fintel.io, 59. www.marketbeat.com
