What to expect from companies announcing results week commencing 15 April 2019.
Companies reporting w/c 15 April
The Share Centre gives its thoughts on what to expect from companies announcing results week commencing 15 April 2019.
Bunzl (Q1 2019 Earnings Release)
Packaging and disposable products group Bunzl beat expectations with its full-year results in February, although the shares dropped back thanks to a fall in profit margins. The UK operation remains under pressure and the market will focus on that in this first quarter trading update although the UK accounts for less than 15% of overall revenues. Prospects for the rest of the current year will be another focus although the defensive nature of the business means there should be few surprises. Any hints on possible further acquisitions will also be of interest to the market.
We currently list Bunzl as a BUY
Segro (Trading Update)
While many commercial property developers have struggled in recent times Segro has benefited from the growth of online retailing and the subsequent increased demand for warehousing. Full-year results in February were well received and regarded as strong by the market. At the same time the company raised £451m via a sale of shares to fund future development projects and investors will be interested in any update on where the new funds might go. The vacancy rate and any guidance on rental income levels so far in the new financial year will also be of interest.
We currently list Segro as a HOLD
Companies reporting this day include:
BHP Group (Q3 2019 Sales and Revenue Release) – BUY
Unilever (Trading Update)
Consumer goods giant Unilever has been focusing on trying to increase its earnings growth in recent times but the market was rather underwhelmed by the forecast for growth this year given at the time of full-year results in January. New CEO Alan Jope said it would likely be towards the bottom of the 3-5% range given previously, so investors will be interested to see if that remains the same. Any comments on expectations for profit margins will also be a focus as will the performance in emerging markets which have the best prospects for growth.
We currently list Unilever as BUY
Rentokil (Trading Update)
Warm weather last year may have proved troublesome for some travel operators but it was good news for Rentokil as it boosted demand for their pest control services. When the company revealed some good full-year figures in February the CEO sounded fairly upbeat about prospects for 2019 so it will be interesting to see if that continues to be the case. The company feels relatively immune from Brexit as 90% of its revenues come from overseas, and the market will be interested to see if it intends to make any more acquisitions this year after a big push in that direction last year.
We currently list Rentokil as HOLD
In a holiday shortened week there will be a number of key economic releases from the UK during the week starting off on Tuesday with the latest jobs numbers. The unemployment rate could dip to new historical lows below 3.9%. But more focus is likely to on the rate of wage growth which the previous month stood at 3.4%.
However, on Wednesday we have the inflation figures which have recently dropped below the bank of England’s 2% target rate following lower commodity prices at the end of 2018, but given the fact that wage growth has been picking up, some expect this to feed into the inflation numbers and possibly lifting above the target rate again.
Finally on Wednesday we also have the latest retail figures. The sector is under immense pressure especially non-food given the Brexit induced caution, but because of the fear of a hard no-deal and panicky consumers stocking up, we may see a temporary boost to retail sales as we have been seeing in the latest manufacturing numbers.
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