The Ocado share price is on its way down once more, following a dissent by a segment of its shareholders against a plan to extend pay hikes for CEO Tim Steiner and other directors.
At last Wednesday’s annual general meeting, a little under 30% of shareholders voted against the directors’ pay policy. There was also a dissenting vote against a so-called “value creation plan” that would see Steiner’s pay bumped up to 20 million pounds per annum while other directors earn 5 million pounds each.
The dissenting votes come at a time when the shares of the online grocery retailer are struggling. The decline in the Ocado share price began after completing the 30 September 2020 and 4 February 2021 double top and the breakdown of the ascending channel by the 30 April 2021 daily candle.
The steady decline was accentuated when Ocado Retail lowered its previous outlook for 2022 as the UK retail market softened. The full-year revenue forecasts have been cut from the mid-teens to “closer to 10%”, with margins being squeezed by higher energy costs and change in shopping habits by UK consumers facing reduced purchasing power from spiralling inflation.
The Ocado share price is currently down by 1.01% on the day and already trading 15.22% lower in May.
Ocado Share Price Outlook
A descending triangle on the 4-hour chart of Ocado looks ominous. A breakdown of its lower border at 779.8 makes for a drop that targets the 744.4 support level (16 November and 24 December 2018 lows). Attainment of this support completes the triangle’s measured move. However, if the bulls fail to defend this support, the 17 May 2018 low at 691.8 becomes the next target to the downside. Below this level, several key price levels seen in 2018 become available as additional southbound targets. These are at 604.6 (8 March 2018 high) and at the 500.0 psychological support (12 April 2018 low).
On the flip side, a bounce from current levels needs heavy bullish momentum to target the 886.2 resistance mark (3-5 May lows). A break above this level opens the door for an advance towards the 997.0 resistance. Only when this barrier is breached will 1074.0 (8/28 March and 20 April lows) enter the mix as the additional target to the north. The 27 April high at 939.4 may serve as a pitstop between 886.2 and 997.0.