We gives our thoughts on what to expect from companies announcing results week commencing 31 August 2020.
Companies reporting w/c 31 August
Barratt Developments Plc (Q4 2020 Earnings Release)
In these full year figures investors will be keen to hear what level of demand the company has seen since it reopened all of its sites at the end of June, and how the construction is coping with the new Covid restrictions. In July, at the time of the last update, the company said it was cautiously optimistic about the outlook, which cheered the market, and shortly after that the Chancellor raised the threshold for stamp duty to provide a boost to the property market. Investors will also be interested to hear any comments around future returns to shareholders.
We currently list Barratt Developments as a HOLD
The Gym Group Plc (Q2 2020 Earnings Release)
This low-cost gym operator, with around 175 sites around the country, was naturally impacted by the Covid lockdown, but most of its gyms reopened in July. At that stage the company said capacity would be reduced due to social distancing measures and few of its sites would be returning to their usual 24hr opening schedule. Investors will be interested in whether that remains the case, and also whether there has been any improvement in membership numbers. Any guidance on full year figures will also be of interest, but given the level of uncertainty that may still not be possible.
We currently list Gym Group as a BUY
Melrose Industries Plc (Q2 2020 Earnings Release)
Recent updates have reflected on the problems of being exposed to the automotive and aerospace industries, with a sharp fall in revenue and that profit guidance for the year would be only to break-even. Costs will be cut further and a new recent financing deal has eased concerns over the balance sheet. The focus will now be on managing the challenging situation created by the virus. The share price has been hit very hard in the current crisis and the shares remain one of the more volatile in the FTSE 100.
We currently list Melrose as a BUY
Berkeley Group Holdings Plc (AGM Trading update)
A very mixed year for housebuilder Berkeley. Like most of its peers it was affected by the Covid lockdown but it managed to keep its construction sites open and in June reported better than expected full year profits. It said sales in April and May were at half of normal market conditions so in this trading update the market will be interested in whether that has improved since. It has recently confirmed an interim dividend in September and the return of a further £140m to shareholders by March next year. Sadly the company has also recently seen the passing of its founder and chairman Tony Pidgley.
We currently list Berkeley as a HOLD
All information given including prices, yields and our opinion is correct at the time of publication. Our opinions on investments can change at any time and for our latest view please go to www.share.com. To understand how our Investment research team arrive at their views please read our Investment Research Policy.