In a first-quarter trading update released yesterday, Sainsbury said that like-for-like sales in the 12 weeks to 17 June increased 5.7% excluding petrol, beating analyst expectations of 5.5%. Total sales for the quarter increased 8.1%.
However, analysts remained divided over whether Sainsbury would be able to sustain its current level of performance.
Philip Dorgan, from Panmure Gordon, said: “The last ten years at Sainsbury's is littered with examples of periods where sales growth perked up, only to wither and die at the first sign of tougher comparables.”
He added: “Justin King is getting sales growth but it is profitless and at some point Sainsbury needs to deliver profit growth.”
Jonathan Pritchard, from Oriel Securities, disagreed. He said: “Whichever way you cut it, they are doing better than Tesco and I don't see any reason why they can't sustain this for a long time - two or three years.”