What to expect from companies announcing results week commencing 22 April 2019.
Companies reporting w/c 22 April
The Share Centre gives its thoughts on what to expect from companies announcing results week commencing 22 April 2019.
Associated British Foods Plc (Q2 2019 Earnings Release)
Shares in the conglomerate have outperformed the market so far this year, but with the fall in sugar prices and investment in Primark growing, the market will be focussing on guidance for full-year earnings in these interim figures. Given the woes on the UK high street, exemplified most recently by Debenhams going into administration, there will also be a lot of interest in any comments on the latest performance of Primark in the UK and what plans there are for future expansion. The company recently opened its largest store in the UK in Birmingham and the CEO has talked of launching a click-and-collect service for Primark.
We currently list Associated British Foods as a HOLD
Boohoo (Q4 2019 Earnings Release)
Shares in the online fashion retailer wobbled before Christmas after a profit warning from peer ASOS. However, a trading update from Boohoo in January was very reassuring and showed a 43% rise in revenue in the final four months of 2018. More recently an update from ASOS was also seen as positive and has given a further boost to Boohoo. The market will be focussing on how trading is going in the US which has been strong so far this year, with PrettyLittleThing the best performing brand. Any update on the plans to expand the key Burnley warehouse will also be of interest.
We currently list Boohoo as a BUY
Companies also reporting this day include:
AB Dynamics (Q2 2019 Earnings Release) – BUY and Antofagasta Plc (Q1 2019 Sales and Revenue Release) – HOLD
Taylor Wimpey (Q1 2019 Sales and Revenue Release)
The full-year results in February showed decent growth in profits and cash balances, enabling the housebuilder to continue with its healthy dividend payments. Investors will be focusing on that again in this first quarter update, and also looking out for any mention of the forward order book as an indication of future demand. The shares have made a good start to 2019 but recent house price data has shown a marked slowdown in growth, and if inflation starts to rise then interest rates could begin to creep up which would impact the housebuilding sector. There is also concern about what impact the closure of the government’s Help to Buy scheme in 2023 will have on the sector.
We currently list Taylor Wimpey as a HOLD
Barclays (Q1 2019 Earnings Release)
Long suffering investors are likely to be a little nervous ahead of this first quarter update. Markets have been fairly quiet of late potentially putting pressure on its still important investment banking division. Questions continue to be raised over the group's strategy, not least by the activist investor Edward Bramson. Any comments on Brexit and the outlook for the year ahead will be worth noting especially with regard to the UK and US where the banks future focus will be concentrated.
We currently list Barclays as a HOLD
Companies reporting on this day also include: Tullow Oil (Q1 2019 Sales and Revenue Release) – BUY, Anglo American (Q1 2019 Sales and Revenue Release) – HOLD and RELX (Q1 2019 Sales and Revenue Release) – BUY
Royal Bank of Scotland (Q1 2019 Earnings Release)
Full year results reported in February were a bit of a mixed bag, with some fourth quarter improvements offset by the CEO's rather gloomy outlook. The significant risks and uncertainties in the external economic, political and regulatory environment especially relating to Brexit have not gone away. These have been putting pressure on some of its medium-term targets relating to reducing costs. The restructuring of the group is approaching the final straight, shifting its business towards retail and commercial banking. Dividend growth is now firmly back on the agenda, but investor focus may remain on Brexit, costs and impairments.
We currently list Royal Bank of Scotland as a HOLD
WPP (Q1 2019 Earnings Release)
The past two years have been extremely difficult for the group and the market will be looking for signs that the ongoing restructuring could be of benefit in the future. Investors will be hoping there is no further bad news following on from the warning in March of a 2% revenue fall for the first half. The share price hit a six year low in February as a result of the uncertainty surrounding the company and the sector it operates in. Any news regarding the sale of Kantar, its data and consulting company, and the performance of its important North American operations, where sales have been falling, are areas to concentrate on.
We currently list WPP as a HOLD
AstraZeneca (Q1 2019 Earnings Release)
There shouldn't be too many surprises for investors in this first quarter update as the company provided some guidance only a couple of weeks ago when it announced the $7bn acquisition of a new cancer treatment. The company is fighting off generic competition for some of its big products, but sales of newer drugs have been doing very well recently and the company has increased spending on R&D to try to ensure a decent pipeline of future treatments. In this first quarter update the market will be keen to hear how important emerging markets such as China are performing.
We currently list AstraZeneca as a BUY
Looking at the week ahead, the only major event investors will be watching closely is the announcement of US GDP figures on Friday. Analysts expect the US economy advanced an annualised 1.8% in the first quarter of 2019, lower than the previous estimate of 2.2% annualised growth in Q4 2018. However, in the-long term the US economy is projected to grow by around 2% on an annual basis.
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