Sainsbury’s market share growth faces a number of challenges

As Sainsbury reports Q3 results Sheridan Admans, investment research manager at The Share Centre, explains what they mean to investors.

"Today's results highlight the challenges faced by Sainsbury in maintaining its growth in market share achieved in 2012. Although it has been impressive it is for the taking, especially as Tesco diverts its attention away from aggressive expansion to focus on service in its UK operations.

"The festive season has been more modest than food and drug retailers were expecting and the resilience of discounters like Aldi continues to chip away at market share.

"We continue to recommend investors ‘hold' Sainsbury for now, as market conditions are challenging and competition is tough. The business has a strong management track record and for income investors already holding the stock the dividend is well covered at present."

For more information, visit share.co.uk.