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The Tesco (LSE:TSCO) share price has been on a rampage over the last six months, climbing 32.8% as the UK’s largest supermarket chain continues to impress. As such, anyone who put £5,000 to work back in March is now sitting on just over £6,600. But could the retail giant repeat this performance in 2026?
Here’s what the experts are saying.
Latest forecasts
Looking across the latest consensus among institutional analysts, the overall mood remains quite bullish. Of the 15 experts tracking the business, 12 currently rate Tesco shares as a Buy or Outperform. And with the company delivering impressive sales momentum as well as improved operational efficiency in its latest results, several share price forecasts have been updated.
Towards the start of 2025, the average consensus for the Tesco share price sat around 420p. Skip ahead to September, at the average consensus is closer to 460p.
Despite concerns of a new pricing war and the growing presence of discount retailers, Tesco’s proven to be quite effective at defending and even growing its market share. Subsequently, management reiterated its full-year earnings and free cash flow generation guidance, paving the way for an impressive £1.45bn share buyback programme that’s on track to be completed by April 2026.
But what does this all mean in terms of money? If the experts are right, then based on where Tesco shares are trading today, a price target of 460p suggests a 6% potential return. Combining this with the group’s 3.1% yield suggests a £5,000 investment right now could grow to around £5,500 by this time next year.
A stock to consider?
While a near-10% return is nothing to scoff at, it certainly pales in comparison to the group’s more recent performance. And it suggests that most of the untapped potential of Tesco is already baked into its share price.
Having said that, it’s still possible that the business will once again beat expectations, sending shares even higher. For example, the supermarket continues to take market share away from its rivals, leveraging its accelerating online presence.
On the other hand, the business may also underperform. Rising input costs, particularly around transport and wages, may begin to outpace Tesco’s ability to pass this expense onto customers, squeezing profit margins. This threat’s only amplified by competitive forces.
Specifically, both Aldi and Lidl are busy capitalising on rising value-seeking behaviour from consumers who continue to face cost of living pressures.
Nevertheless, with everything in mind, I remain cautiously optimistic for the Tesco share price in 2026 and beyond. These shares are unlikely to be a source of tremendous growth. However, investors seeking more stable income-generating opportunities within the retail sector may want to consider taking a closer look.
