The week ahead: M&S, Halfords, insurers
3rd November 2017 16:24
by Lee Wild from interactive investor
Monday 6 November
Trading Statements
Grafenia, Kosmos Energy, Aldermore
AGM/EGM
Murray Income Trust, Genesis Emerging Markets Fnd, Mid Wynd International Investment Trust
Tuesday 7 November
helps kick off a round of results from London-listed insurers Tuesday. The specialist UK non-life insurer said last month that the impact of hurricanes Harvey and Irma was expected to be about $225 million (£170 million).
We'll get a clearer idea of what the losses will be in this third-quarter update. There should be more news on the hit from Hurricane Maria and the Mexican earthquakes, and a better steer on the impact on rates going forward.
Broker Stockdale has provisionally cut its full-year 2017 pre-tax profit estimate to £88 million but will continue to monitor "as these claims develop". Profit forecasts for 2018 remain unchanged "but this may prove conservative," the broker adds.
Trading Statements
Hiscox, Jardine Lloyd Thompson, Tyman, G4S, Direct Line Insurance, ConvaTec, First Derivatives, Castleton Technology, Carclo, Verona Pharma, UP Global Sourcing Holdings, Associated British Foods, Imperial Brands
AGM/EGM
Papillon Holdings
Wednesday 8 November
A grim outlook from retail bellwether dumped the retail sector recently, including . Now, the high street favourite gets its chance to prove sellers wrong.
Investec Securities pencils in a 12% slump in half-year pre-tax profit to £203 million due to weak sales and as foreign exchange and cost pressures fall mostly in the first half. "Reassurance on current trading is needed for the shares to go better in our view," says the broker. "For us, valuation is not compelling enough given poor earnings visibility. Sell."
Management does not typically talk about current trading, but Investec looks for tighter execution to result in a stronger performance than the 0.1% decline in like-for-like sales during the first quarter. At the Clothing & Home division, it expects gross margin to be down, with FX pressures partially offset by better buying and less promotions.
The analyst team at Barclays anticipate a 0.3% decline in first-half like-for-like food sales and gross margin decline of 60 basis points. Clothing & Home is seen down 1.8%, while group underlying pre-tax profit is tipped to drop 13% to £201 million.
Trading Statements
Wetherspoon (J D), Onesavings Bank, Persimmon, Tullow Oil, Novae Group, esure Group, Wizz Air, JZ Capital Partners, Workspace Group, SSE, Sophos Group, Marks & Spencer, Tracsis
AGM/EGM
Ricardo, Strategic Equity Cap, Craneware, Pathfinder Minerals, Picton Property Income, Macau Property Opportunities Fund, Haynes Publishing
Thursday 9 November
Bikes to car parts chain has been polishing up its numbers ready to present on Thursday. According to Investec estimates, interim pre-tax profit will be down 6% at £38.4 million. Consensus is for £37.4 million, which management has already said it is comfortable with.
Chiefs also believe they can fully mitigate the £40 million FX hit – "a potential profit upgrade gift to the new CEO," says Investec, which has a 'buy' rating on the shares and 400p price target.
The broker believes a forward PE ratio of 10.5 is "undemanding given Halfords' strong cash generation with potential for double-digit [total shareholder return] per annum, consisting of single-digit EPS growth, a 5.4% dividend yield and potentially a sustainable 3.0% (£20m) special dividend yield per annum."
Shareholders in will be nursing losses after the drugs major slumped in reaction to last month's third-quarter results. The City didn't like weaker-than-expected sales of respiratory products.
At least shareholders still receive decent income. A 19p dividend was declared for the quarter, part of an anticipated 80p for the full-year 2017. Glaxo shares go ex-dividend Thursday 9th November.
Trading statements
Beazley, SuperGroup, Informa, Hikma Pharmaceuticals, Coca-Cola HBC, IMI, Derwent London, Prime People, Sainsbury (J), National Grid, Renewi, Halfords, AstraZeneca, Auto Trader, Arrow Global, Inmarsat, Dairy Crest, Burberry Group, Gattaca
AGM/EGM
Urals Energy, Swallowfield, Redrow, Primorus Investments
Friday 10 November
Trading statements
BBA Aviation, Castings, Volex Group, Vedanta Resources, Burberry
AGM/EGM
Vinaland, Tlou Energy, Galliford Try
This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.