What to expect from companies announcing results w/c 22 January
Companies reporting w/c 22 January
Graham Spooner, Investment Research Analyst at The Share Centre, gives his thoughts on what to expect from companies announcing results week commencing 22 January 2018.
easyJet (Q1 results)
At the time of the full-year results last November, the budget airline said the new financial year had started well with forward bookings for the first quarter well up on the previous year and encouraging revenue trends as well. The passenger stats already released for December were fairly reassuring given that they cover the important festive period. The market will also be interested in any comments around the ongoing sale of Alitalia with recent reports that it has joined forces with Air France-KLM to make a joint bid.
We currently list easyJet as a HOLD
Companies also reporting today includes: Marston’s (Q1 trading update) - BUY
Sage (Q1 trading update)
The accounting and HR software group has seen good steady growth in recent years as its push into cloud services pays off. For the last financial year cloud services grew by 30% and investors will expect similar growth rates for the start of the latest financial year. Being a company with a global sales profile, we should see global business confidence reflected in the sales figures, however, part of Europe, notably France has been weak while some may looks for signs of weakness in the UK as a result of Brexit uncertainty. Investors will hope that management maintain their guidance for organic revenue growth of 8% and operating margins of around 27.5%.
We currently list Sage as a HOLD
Companies also reporting today include: Antofagasta (Q4 production report) – HOLD
Anglo American (Q4 production report)
Shares in the sector have been in a sweet spot lately as synchronised global economic growth leads to improving commodity prices. Miner’s deep restructuring has also left them better positioned and looking at their peers who have reported solid production figures recently, investors will hope for the same from Anglo. Investors will hope that the production increases in diamonds and copper from the third quarter followed through into fourth quarter and a reversal of the decline in iron ore, coal and nickel.
We currently list Anglo American as a HOLD
Diageo (Interim results)
Many of those Scots celebrating Burns’ Night around the world will be consuming one of Diageo’s products, most likely a whisky of some description. The shares have enjoyed a strong run over the past year, reaching a record high in December. The last trading update in September stated that the company expected first half sales to be impacted by the later timing of Chinese new year and a ban on selling alcohol near Indian highways, but full-year guidance was left unchanged. The market will be focusing on the performance of the all-important North American market, which accounts for almost 50% of operating profits.
We currently list Diageo as a BUY
Sky (Q2 results)
With the proposed takeover of the group further complicated by the Disney offer for 21st Century Fox still ongoing the results may remain somewhat overshadowed. New customer numbers and revenue growth will be worth noting, as will its development of new markets in Spain and Switzerland. Sky continues to invest in its range of media products and programme content, along with other initiatives aimed at continuing the group's growth.
We currently list Sky as a HOLD
Restaurant Group (trading update)
The market has remained cautious on the sector over the important run up to Christmas and the cutting of prices for some main meals increased analyst concerns. This has been reflected in the share price, which remains close to a 12-month low. Investors will be hoping that the strategic review completed last year has steadied the ship.
We currently list Restaurant Group as a BUY
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