JPMorgan places Ahold Delhaize on Negative Catalyst Watch and reiterates Underweight

Overview

This report focuses on the short-term risks for Koninklijke Ahold Delhaize NV ahead of its 1H26 results release. JPMorgan believes that although the company has a strong market position, defensive characteristics, cash flow generation, and a record of capital returns, it lacks clear catalysts over the next few quarters, the U.S. profit cycle may be nearing its end, and the stock could remain under pressure.

Core views

The core view is that the market's expectations for Ahold Delhaize's same-store sales, comparable sales, and margins in 2Q26 and 2H26 are too high. JPMorgan expects the U.S. business to be affected by an overall market slowdown and weaker Circana-implied run rates, while the European business faces weaker food CPI and profit drags in certain countries; if its 2Q26 forecasts materialize, the degree of improvement required in 2H26 for the company to achieve its FY26 guidance of high-single-digit EPS growth would be very significant and difficult to deliver.

Analysis framework

The report assesses stock risk by updating 2Q26 and FY26/FY27 forecasts, comparing them with Bloomberg consensus, observing readings from comparable companies such as WMT and KR, using Circana-implied U.S. run rates, and incorporating the latest CPI, FX, risk-free rates, and DCF valuation.

Methodology notes

• Valuation methods5Y DCF

  five-year DCF valuation

  JPMorgan uses a 5-year DCF model, assuming a WACC of 9.2% and a terminal growth rate of 1%, to derive an end-2027 target price of about €24.1/share.

• catalystNegative Catalyst Watch

  negative catalyst watch

  Catalyst Watch is JPMorgan's short-term conviction indicator for covered stocks, used to express a short-term positive or cautious view based on near-term fundamentals ahead of specific events, which may differ from the long-term relative rating.

• relative_estimateJPMe vs Bloomberg Consensus

  comparison of JPMorgan forecasts versus Bloomberg consensus

  The report compares JPMorgan's forecasts for 2Q26, FY26, and 2H26 revenue, LFL, operating profit, margin, EPS, and FCF with market consensus to identify expectation gaps.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Koninklijke Ahold Delhaize NV (AD.AS, AD NA)

  Covered name; rated Underweight and placed on Negative Catalyst Watch

  Strengths

  Strong market position, defensive characteristics, stable cash flow generation, and a record of capital returns.

  Weaknesses

  The U.S. profit cycle may be running out, there is a lack of clear near-term catalysts, and slower LFL plus price investment are pressuring margins.

  Comparison

  JPMorgan is about 2%-3% below market on FY26/FY27 operating profit and about 7%-13% below market on EPS.

  Risks

  If the competitive environment is more rational than expected, food inflation normalizes, and pressure from price investment eases, this could present upside risk.

• Jeronimo Martins (JMT.LS, JMT PL)

  One of the European food retail companies discussed in the report's coverage universe

  Strengths

  The report does not provide sufficient detail.

  Weaknesses

  The report does not provide sufficient detail.

  Comparison

  Listed as a peer within coverage, but the core analysis of this report is focused on Ahold Delhaize.

  Risks

  The report does not provide sufficient detail.

Key data

• Report date2026-06-24Europe Equity Research.
• Current price€34.91Price as of intraday on 2026-06-23.
• Target price€24.07Dec-2027 target price; previously €23.86.
• 2Q26 U.S. LFL forecast1.0%Previous forecast was 2.0%; about 89 bps below Bloomberg consensus.
• 2Q26 U.S. operating margin forecast4.2%Down 15 bps YoY, dragged by price investment.
• 2Q26 Europe LFL forecast2.1%A clear slowdown from 4.9% in 2Q25.
• 2Q26 Europe operating margin forecast3.6%Down about 11 bps YoY.
• 2Q26 group adjusted operating profit forecast€892m2.3% below Bloomberg consensus.
• 2Q26 adjusted EPS forecast€0.61Down 5.4% YoY and 7.9% below Bloomberg consensus.
• FY26 revenue forecast€93,062mEquivalent to 0.8% YoY growth.
• FY26 adjusted EPS forecast€2.69Below Bloomberg EPS of €2.81.

Impact & implications

If JPMorgan's forecasts materialize, Ahold Delhaize's short-term earnings and valuation support may come under pressure, and the market may need to revise down expectations for 2H26 and FY26. The current share price has significant downside relative to the target price, with negative catalysts mainly centered on the 1H26 results and disclosure of 2Q26 operating metrics.

Risks

• If the competitive environment remains rational for longer, pressure from price investment and margins could ease.
• If food inflation normalizes better than expected, it could improve European same-store sales and profitability.
• Favorable EURUSD movements have already led to some upward revision to U.S. revenue and EBIT forecasts, and further FX improvement could provide upside.
• If 2H26 operating trends are better than JPMorgan expects, the company could still come closer to its FY26 guidance for high-single-digit EPS growth.

What to watch

• 1H26 results release on August 5, 2026.
• 2Q26 U.S. LFL, volume trends, and Circana-implied run rates.
• The extent of the drag from U.S. price investment on operating margins.
• Changes in European food CPI and whether drags from the Serbia and Romania businesses continue.
• Whether the company's FY26 EPS growth guidance is adjusted and whether market consensus is revised down.