Tesco(US:TSCDY) ZACKS·2025-10-17 17:01Core Viewpoint - Tesco PLC has been upgraded to a Zacks Rank 1 (Strong Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the correlation between changes in earnings estimates and stock price movements, making it a valuable tool for investors [2][3]. - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to price movements based on their buying or selling activities [3]. Business Improvement Indicators - The increase in earnings estimates and the Zacks rating upgrade suggest an improvement in Tesco's underlying business, which could lead to higher stock prices as investors respond positively [4]. Importance of Earnings Estimate Revisions - Research indicates a strong link between earnings estimate revisions and short-term stock movements, highlighting the effectiveness of the Zacks Rank system in leveraging this relationship for investment decisions [5][6]. Tesco's Earnings Estimate Revisions - For the fiscal year ending February 2026, Tesco is expected to earn $1.15 per share, with a 5.8% increase in the Zacks Consensus Estimate over the past three months [7]. Zacks Rating System Overview - The Zacks Rank system categorizes stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [6][8]. - Tesco's upgrade to Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, indicating strong potential for near-term price appreciation [9].