How to Buy Sainsbury's Shares UK [2024]

Diversifying your portfolio with grocery retail stocks can be a savvy move, particularly in the face of the economic uncertainty of recent years. As one of the UK’s leading supermarket chains, Sainsbury’s offers potential investors a chance to capitalise on a business that touches virtually every household, making it a share worth considering.

Keep reading as we analyse the most important facts about the retailer, explain how to buy Sainsbury’s shares in the UK, and provide an overview of the most reliable brokers to use.

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About Sainsbury’s

‘Sainsbury’s (LSE: SBRY) is a British supermarket chain headquartered in London, England. Founded in 1869 by John James Sainsbury with a shop on Drury Lane in London, Sainsbury’s held the position of the largest grocery retailer until 1995, at which point Tesco (LSE: TSCO) surpassed it to become the market leader. The parent company, J Sainsbury plc, operates through three primary divisions: Sainsbury’s Supermarkets Ltd, which includes convenience stores; Sainsbury’s Bank; and Argos.

Sainsbury’s homepage. Source: sainsburys.co.uk

The retailer stands as one of the leading grocery retailers in the UK, holding 41.9% of the market together with Tesco, and is recognised as one of the “big four” supermarkets alongside Tesco, Asda, and Morrisons.

Market share of grocery stores in the UK from January 2017 to April 2023. Source: statista.com

As depicted by the chart below, the company sales revenue has been relatively steady since 2017, hitting a new peak in 2022/23, with over £35.1 billion in revenue.

Annual underlying sales revenue of Sainsbury’s in the UK from 2010/11 to 2022/23. Source: statista.com

Sainsbury’s is a publically traded company listed on the London Stock Exchange under the stock symbol SBRY and is a constituent of the FTSE 100 Index.

Where to buy Sainsbury’s shares?

The easiest way to buy Sainsbury’s shares is to sign up with an online broker—such as eToro—that provides access to the London Stock Exchange and SBRY.

Remember to conduct your due diligence before investing in stocks in the UK, including understanding the company’s business model, financial health, future prospects, and the risks involved in investing in the stock market.

With that being said, let’s delve into the step-by-step process.

How to buy Sainsbury’s shares? Step-by-step process

As a publicly-traded company, Sainsbury’s shares can be purchased through a regular retail broker or investment platform.

The following section will offer an in-depth overview of the step-by-step process as well as our recommendation for specific platforms to consider.

Step 1: Choose a broker

Your ideal platform should align with your investment goals, budget, and comfort level with trading. When assessing brokers, consider these factors:

Regulation: Confirm that the broker is fully licensed and authorised by the Financial Conduct Authority (FCA). This regulatory oversight ensures that the broker complies with specific operational standards, offering a level of protection for your investments;
Cost: Familiarise yourself with all the expenses linked to the specific broker to ensure they align with your budget. Luckily, you can expect commission-free stock and exchange-traded fund (ETF) trading from most online brokers;
Platform usability: Consider how easy using the broker’s platform is. Some platforms are user-friendly and designed for beginners, while others offer more advanced features;
Asset availability: Verify that the broker provides access to the particular asset classes that interest you, such as stocks, bonds, commodities, cryptocurrencies, or forex;
Customer service: Research the broker’s reputation regarding customer service, including their response speed, quality of their assistance, and client satisfaction;
Fractional stock trading: Fractional shares allow investors to purchase stocks or ETFs by the sterling amount. This is particularly useful for investors with limited capital or those intending to implement a dollar-cost averaging (DCA) strategy.

To securely invest in Sainsbury’s and buy SBRY stock, consider these brokers:

1. eToro

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2. Interactive Brokers (IBKR)

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Step 2: Fund your account

After choosing a broker and establishing an account, the next step is adding money. You’ll usually have several options for making deposits, such as connecting a bank account directly, utilizing a debit, credit, or prepaid card, or choosing a third-party payment provider .

Note that it can sometimes take up to three days for the money to reach your account.

Step 3: Research the company

You can start your research by exploring Sainsbury’s official website, specifically the “Investor Relations” section. Here you’ll find access to numerous resources such as annual reports, shareholder presentations, regulatory news, as well as Environmental, Social, and Governance (ESG) strategies.

These resources will offer invaluable insights into Sainsbury’s financial well-being and future strategies, as well as potential roadblocks that the company or industry may face, including disruptions in the supply chain, employee retention, sustainability pledges, and escalating competitive pressures.

Step 4: Decide how much you want to invest

Before deciding on the amount, assess your financial situation:

Ensure you’re only investing money you can afford to lose without affecting your standard of living;
Never use money meant for daily living expenses, emergency savings, or financial commitments such as debt repayments.

Of course, your risk tolerance also dramatically influences this decision, as the amount you’re willing to invest can vary depending on your comfort level with potential losses.

Step 5: Place your order and buy SBRY shares

Once you’ve determined how much you want to invest, you’re ready to place your order. You can do this by logging into your brokerage account, searching for the ticker SBRY and clicking on ‘Open Trade’ or ‘Buy’.

You’ll have two execution options:

Market order: An order filled at the best available market rate at the time (or when the market opens);
Limit order: A limit order allows you to predetermine the price at which a trade will be executed. Limit orders come into effect only when the price hits a specific target level, converting into a market order as soon as the market rate matches the rate specified in your order.

Invest in SBRY with index funds

Diversify your assets to ensure your portfolio maintains a healthy balance of risk and reward. One of the easiest ways to achieve this is by investing in ETFs.

Step 6: Monitor your investment

Monitoring your investment in Sainsbury’s involves periodic tracking and analysis of both the company’s performance and the broader market. Here are a few recommended practices:

Staying informed about company updates: Keep an eye on the same annual reports you used to conduct your preliminary research. Also, stay updated on company news, such as changes in leadership, new ventures, and significant events;
Inspecting stock performance: Regularly check the performance of Sainsbury’s stock. Remember, short-term market fluctuations are common and don’t necessarily impact a company’s long-term potential;
Comparing against relevant benchmarks: Compare the stock to a relevant market benchmark to determine its relative performance to the broader market or specific sector. Persistent underperformance against its index might indicate a cause for concern;
Understanding market trends: Are we in a bear or a bull market? Are the general market trends positive or negative? The overall state of the market influences the performance of all stocks.

Make sure to review your investment strategy regularly, but avoid making impulsive decisions based on short-term market movements.

Bonus step: Track the performance of market competitors

Keeping an eye on the performance of other players in grocery retail, such as Tesco, Walmart (NYSE: WMT), Amazon (NASDAQ: AMZN), and Dollarama (TSX: DOL), can provide crucial comparative insights.

Should I buy Sainsbury’s shares?

Whether investing in Sainsbury’s is the right choice for your investment portfolio depends on your risk tolerance and investment goals.

In addition to examining the company fundamentals, you can use technical analysis to evaluate the stock and identify trading opportunities in price trends and patterns seen on charts.

The gauge displayed here represents the real-time technical analysis overview of Sainsbury’s for your specified timeframe (in this case, one day). It can simplify trading decisions (subject to your proficiency in technical analysis) by demonstrating the real-time recommendations of popular technical indicators such as moving averages and oscillators.

Disclaimer: TradingView does not recommend trading financial instruments based exclusively on the advice of the Technical Rating indicator. These recommendations cannot predict future movements and are meant as assistance for spotting potentially favourable buy/sell conditions if this is consistent with their strategy.

Common mistakes to avoid when investing in the stock market

Some of the most common mistakes to avoid when investing in the stock market include:

Not conducting thorough research on the stock;
Lacking well-defined financial goals;
Trying to time the market;
Not diversifying your investments across a variety of sectors or asset types;
Allowing your emotions to dictate your investment decisions.

Look at our guide on the most common investing mistakes for a more in-depth overview and advice on how to steer clear of such mishaps.

Pros and cons of buying Sainsbury’s shares

Investing in Sainsbury’s, like any company, comes with its own set of advantages and disadvantages. Here are a few to consider:

Pros

Market position: Sainsbury’s is one of the largest grocery retailers in the UK with a substantial share of the market, providing a stable base for continued profits;
Diversified product offerings: Sainsbury’s operations are not limited to groceries, helping to spread risk. In fact, it has diversified into clothing, catalogue retailing, and financial services;
Income-generating: Sainsbury’s is a dividend-paying company with an annual dividend yield of 3.82% (as of January 3, 2024). Read our guide ‘How to Invest in Dividend Stocks in the UK‘ to learn more about this type of stock;
Online presence: Beyond their physical retail presence, Sainsbury’s also maintains a robust digital presence, ranking among the top five online retailers in the UK.

Cons

Intense competition: While Sainsbury’s remains one of the largest supermarkets in the UK, it trails behind Tesco, the leader in market share. Additionally, Sainsbury’s has been neck-and-neck with Asda for the second spot over recent years. The online grocery market sees similar competition, with an emerging rival in the form of Amazon. Furthermore, due to the uncertainties following Brexit and escalating inflation, consumers are increasingly opting for cost-effective alternatives like Aldi and Lidl;
Economic sensitivity: As a retailer, Sainsbury’s revenues could be influenced by the broader economic climate. Economic slumps or recessions may lead to a decline in consumer spending;
Brexit: The impact of Brexit might lead to increased costs for imported goods, which could squeeze profit margins;
Labour shortages: The wave of resignations referred to as the “Great Resignation,” spurred on by the COVID-19 pandemic and worsened by the rising cost of living crisis, has seen a marked departure of employees in the retail sector. Concurrently, Brexit has caused significant changes to the availability of labour due to changes in immigration laws. This combination of factors has noticeably shrunk the workforce and could negatively impact Sainsbury’s operations.

In conclusion

The decision to buy Sainsbury’s shares—or any stocks for that matter—should not be based on impulse or speculation but a well-informed conclusion founded on thorough research and careful deliberation. Always seek professional financial advice if you are unsure about your investment strategy. Ultimately, investing can yield returns, but you must stay committed to the long haul and stay the course.

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.

FAQs about buying Sainsbury’s shares