Companies reporting w/c 26 March

United Utilities (Pre-Close Trading Update)

The threat that has come from regulatory and political issues has led to poor share price performance over the last 10 months. Investors who normally expect little in the way of excitement from trading updates will be looking closely for signs of management defending the sector as well as comments regarding future dividends.

We currently list United Utilities as a BUY

Ferguson (Q2 results)

The last trading update in December showed the business performing well as its key market in the US benefits from a healthy construction market and overall healthy economy. However, with the poorly performing Nordic division being sold off, more attention will now go onto its UK business which has also struggled lately due to a challenging environment. The foreign exchange boost to earnings that it experienced last year should begin to fade.

We currently list Ferguson as a BUY

Chesnara (Q4 results)

Chesnara reported a solid set of half year results as recent acquisitions boosted its overall profitability, this will naturally also be reflected in the full year results. Investors will expect to hear that the integration of these businesses is going well and will also be on the lookout for signs of further acquisitions. The key attraction of this stock is the solid dividend for which investors would expect the policy to be maintained as cash generation is healthy with good solvency ratios.

We currently list Chesnara as a BUY

RPC (Pre Close Trading Update)

With a fair amount of coverage in the media on plastic packaging and plastic waste at the moment, this fourth quarter update from RPC may well attract more attention than usual. The shares have underperformed over the past year, although that follows a good long run. The last update from the company in February showed organic revenue growth of 4% in the third quarter and RPC said profits had grown in line with expectations.

We currently list RPC as a BUY

SSE (Pre Close Trading Update)

The recent Ofgem announcement regarding the next regulatory period is expected to lead to lower returns for energy network groups. Investors are likely to concentrate on comments from the company relating to the regulator and on the proposed deal to demerge its supply business and merge the retail business with Npower. Concerns remain over falling customer numbers and the sustainability of future dividends.

We currently list SSE as a HOLD

Economic Diary: week commencing 26 March 2018

27 March, US Consumer Confidence Index – Conference Board

The closely watched Conference Board survey of US consumer confidence is an index that just keeps giving. It has been pointing to exuberance among US consumers for over two years but, last month, it rose to a new 17-year high, with a reading of 130.8. Can this good news continue?

28 March, Distributive Trades Survey – Confederation of British Industry

Last month this CBI survey fell back from the month before, but still pointed to growth with the headline index at +8, from plus 12. But a sub-index tracking sales for the time of the year did much better, rising from minus 17 to plus four. With inflation apparently on a downward trajectory, and anecdotal evidence pointing to a mild pick-up in wage growth, the UK retail market may be set for mild improvement.

Further announcements include:

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