What to expect from companies announcing results week commencing 4 March 2019.
Companies reporting w/c 4 March
The Share Centre gives its thoughts on what to expect from companies announcing results week commencing 4 March 2019.
Ashtead Group Plc (Q3 2018 Earnings Release)
Equipment hire group Ashtead raised the market’s expectations in December with some strong second quarter numbers and very upbeat comments around prospects for the rest of the year. The shares responded belatedly and have remained steady despite some poor US housing data at the end of January. Investors will be focusing mainly on the performance of the US business as it provides the vast bulk of the company’s revenues. The outcome of Brexit will still have an impact as a softer exit from the EU would probably strengthen Sterling and weaken Ashtead’s figures on translation.
We currently list Ashtead Group as a BUY
Companies reporting this day include Intertek Group (Q4 2018 Earnings Release) – BUY and Direct Line (Q4 2018 Earnings Release) – HOLD and GVC (Q4 Earnings Release) - HOLD
Breedon Group Plc (Q4 2018 Earnings Release)
Breedon provides various aggregates to the construction and building industry. The group has grown in size in recent years as a result of acquisitions, which in turn have expanded its geographical presence. Areas for investors to concentrate on will be costs and its comments on the construction market in the UK and Ireland, especially with regard to house building to which it is highly geared.
We currently list Breedon Group Plc as a BUY
Paddy Power Betfair (Q4 2018 Earnings Release)
The recent bout of equine flu has had an impact on the horseracing industry and investors will be interested to hear more detail on how it has affected one of the largest bookmaking groups, Paddy Power Betfair. With the Cheltenham Festival, one of the biggest events in the year for bookies, just around the corner, the market will also be looking for comments on what the company expects from that meeting. Beyond that the performance of online sports and gaming will be of interest, as well as that of the US and Australian operations.
We currently list Paddy Power as a HOLD
Legal & General Group Plc (Q4 2018 Earnings Release)
The shares have staged a strong recovery in the first two months of the year, more so than it peers as the stock market recovery should hold up investment management fees. Investors will be keen to see if assets under management breach the £1 trillion mark and whether their three tier strategy to offset the fall in individual annuity sales is coming through. However, the media focus is likely to turn to the recent announcement of Michelle Scrimgeor who has been selected L&G Investment Management's new chief executive.
We currently list Legal & General Group as a BUY
Companies reporting this day include Hill & Smith Holdings PLC (Q4 2018 Earnings Release) – BUY
Informa PLC (Q4 2018 Earnings Release)
The main focus from Informa's results is likely to be on the progress the group has made with integrating the acquisition of rival UBM and whether the cost synergies are still on course. This along with other acquisitions should help on giving investors an early indicator on the progress of their Growth Acceleration Plan. Investors will expect their Academic Publishing business to still show stability and will hope the jitters of the global economic growth have not impacted the faster growing Global Exhibitions business. The two other core units, Business Intelligence and Knowledge & Networking have been slower.
We currently list Informa as a BUY
Melrose Industries Plc (Q4 2018 Earnings Release)
The focus for investors and the market will be on comments regarding GKN, which the group acquired in 2018. Management updates on plans to improve margins and profits along with any hints as to selling parts of the business will be worth noting. Analysts believe GKN will be a longer-term turnaround story. Other areas to note will be regarding Nortek, its US based manufacturer of cooling and heating systems and struggling Brush a maker of turbogenerators.
We currently list Melrose Industries as a BUY
Admiral Group Plc (Q4 Earnings Release)
Interim results last August were well received thanks to decent growth in the car insurance business. The whole sector got a boost earlier this year when industry data showed a rise in car insurance premiums, so investors will be looking for any comments from the company on that. The uncertainty around Brexit remains a concern for a company with a European business which is performing well. Income is a big part of the appeal for investors in the sector and the market is expecting to see a 9% rise in dividends this year so that will also be a focus.
We currently list Admiral Group as a HOLD
Companies reporting this day include Aviva (Q4 2018 Earnings Release) – BUY, Schroders Plc (Q4 2018 Earnings Release) – HOLD, Inmarsat Plc (Q4 Earnings Release) – BUY, NMC Health (Q4 Earnings Release) – HOLD
8 March, US Jobs Data for February
Judging by recent economic data, the American economy is still going strong however the data will now be scrutinised in more detail for signs in the jobs data of recent macro-economic and political events such as the US government shutdown, US trade tensions with China and the expectations of moderating global growth rates. The December data showed the unemployment rate ticking up slightly to 4% while slowing hourly earnings growth raised some eyebrows even though over 300,000 jobs were created. For January expectations are that the unemployment rate may have once again dropped below 4% and the wage rate recovering a little, but this time with only 170,000 jobs being created, still a great level by historical standards for this point in the economic cycle.
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