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The week ahead: Premier Oil, ITV, May MPC preview

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Monday 11 May

Economic news

May's announcement from the Monetary Policy Committee (MPC) is due midday on Monday.

Investec's Philip Shaw suggests there is no clear case to begin tightening the monetary stance, and certainly no justification for an easing.

"Accordingly we expect the Bank rate to be held at 0.5% and the asset purchase target at £375 billion" says Shaw.

Trading statements

GW Pharmaceuticals, Diploma, Lonmin, Nature Group, Starcom, Tissue Regenix Group, Dignity, Green Reit, John Laing Infrastructure Fund.

AGM/EGM

European Real Estate Inv Trust, Spirax-Sarco Engineering, Altin.

Tuesday 12 May

Trading statements

easyJet, Bank Pekao Sa, Enterprise Inns, JZ Capital Partners, Verona Pharma, Experian, Just Retirement Group, Hiscox.

AGM/EGM

Clean Air Power, Capita Group, IP Group, Atlas Mara Co-invest, Standard Life, Grafton Group.

Wednesday 13 May

Oil and gas exploration and production company Premier Oil will release an interim management statement mid-way through the week.

Broker Jefferies initiated coverage on the North Sea and Falkland Islands operator this week calling it a "seasoned operator in a tough industry."

Premier Oil is one of the few "mid-cap E&P companies' with a multi-field, full-cycle offshore development track record" says Jefferies, which they see as a necessary skill even in today's environment.

2014 record production of 63.9kboe/d is forecast to decline 12% to 56.7kboe/d this year.

"We recognise recent rebound in the oil price and Premier is particularly sensitive to oil price (both ways). This, aligned to possibilities of current production at or above guidance (IMS 13 May) and imminent results from the Isobel Deep exploration well have seen the stock gain in recent weeks and further near-term trading strength cannot be discounted but a cooler, longer term view informs our valuation."

Jefferies has a 165p target price based purely on Core NAV and in-line with precedent M&A metrics at $15/boe 2P. 'Hold' says the broker.

Economic news

The Bank of England's quarterly inflation report (IR) is due on Wednesday.

There are a number of influences on inflation prospects since February, according to Shaw.

Sterling has been relatively firm - on a trade weighted basis the pound has strengthened by 3.5%, a noticeable rebound in oil prices and it unclear whether the committee will downgrade its growth projections materially following the soft Q1 GDP outturn.

"It is not entirely clear exactly where the IR projections will end up in the light of the various events recently, but we suspect that there will be less talk of downside inflation risks and, as in February, the CPI projections may lie a little above the 2% target during the third year."

Trading statements

New World Resources, TUI AG, Compass Group, SABMiller, Mondi, Partnership Assurance Group, Premier Oil, Barratt Developments, Galliford Try, Compass Group.

AGM/EGM

Direct Line Insurance GroupArian Silver Corporation, Riverstone Energy Limited, Indivior, Blue Capital Global Reinsurance Fd.

Thursday 14 May

ITV will publish a Q1 IMS on Thursday updating on trading and developments since the broadcaster's impressive prelims in March.

Westhouse's Roddy Davidson remains bullish on ITV's underlying fundamentals.

"We expect a combination of strong EPS and DPS progress across our three-year forecast horizon (37% and 83% aggregate growth respectively) and expect the former to be supplemented by further acquisition activity in the content space," says Davidson.

The analyst also sees further special dividend payments as a "real possibility".

"Against this backdrop we regard the group's current valuation as attractive despite a good run. We reiterate our 288p target price and Add recommendation."

Trading statements

Telefonica SA, Mitchells & Butlers, Grainger, Marston's, Euromoney Institutional Investor, TalkTalk Telecom Group, Vedanta Resources, Stobart Group, British Land Co, NewRiver Retail , 3i Group, Old Mutual, Keller Group, Merlin Entertainments, Irish Continental Group, Vesuvius, Rank Group (The), SIG, Aggreko, FBD Holdings.

AGM/EGM

FBD Holdings, Fox Marble Holdings, Prudential, UTV Media, Xchanging , Xcite Energy, UBM, Restaurant Group, Merlin Entertainments, Melrose, LMS Capital, Lloyds Banking Group, Caledonia Mining Corp, Amec Foster Wheeler.

Friday 15 May

Bovis Homes wll release an IMS at the end of the week. Deutsche Bank expects the housebuilder to report a "robust trading environment".

"Through to 2016 we forecast Bovis to show the increasing benefit of its growth strategy: the pull through of new land delivering a strong improvement in ROCE, volumes and selling price. These levers combined with a stronger dividend we believe should lead to a rerating of the stock from its <1x 2016E NTAV" says Deutsche, with a 'buy' reccomendation and 1,107p price target.

Trading statements

New Europe Property Investments, Coca-Cola HBC.

AGM/EGM

Ocado Group, Sistema Jsfc, Restore, Princess Private Equity Holding.

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.

Related Categories

    Commodities
    UK shares
    Consumer goods and services
    Telecoms
    Growth Investor
    Income Investor
    Infrastructure

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