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The forward look, w/c 28 January

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Sheridan Admans, investment research manager at The Share Centre, gives his thoughts on what to expect from companies announcing results w/c 21 January 2013.

Tuesday

Companies reporting today include British Land (interim management statement) – BUY

Wednesday

Imperial Tobacco (interim management statement)

Plans to ban smoking in public places in Russia and China, as well as pressure from the European Union to deliver stricter health warnings, mean the tobacco industry is under continued pressure to find markets and products that enable it to grow revenues, other than through continued price hikes.

Investors will be keen to see if Imperial Tobacco has made inroads to the rate at which volumes have been falling and whether its pricing strategy continues to support margins in Europe.

Further evidence of it continuing to build market share in its key markets and increasing demand for its luxury products, such as Cuban cigars and snus, will also be of interest.

We currently list Imperial Tobacco as BUY

Companies also reporting today include United Utilities (interim management statement) – BUY, Polymetal International (Q4 results) – HOLD, Antofagasta (Q4 results) – HOLD

Thursday

Babcock International (interim management statement)

Investors will be hoping that management confidence for the year ahead is maintained. There have been concerns over defence spending so comments on this important part of the business will be another area to concentrate on. Investors will be keen to receive an update on the potential benefits for further outsourcing to the group and the bid pipeline, along with the recent acquisition which is set to boost its marine energy business.

We currently list Babcock International as a BUY

BSkyB (Q2 results)

The steady rise in the share price into the New Year suggests that consumers continue to value the company’s packages and that user numbers will be maintained. Investors will be keen to hear about BSkyB’s ability to win new clients, possible new ventures overseas and the pay as you view film option.

We currently list BskyB as a BUY

Royal Dutch Shell (Q4 results)

Investors should be pleased to see that Brent crude oil is still trading above $100 dollars a barrel and will be keen to see the impact on Royal Dutch Shell’s underlying earnings. Investors will also look for updates on the capital investment and cost cutting programs.

We currently list Royal Dutch Shell as a BUY

AstraZeneca (Q4 results)

This will be the first set of results under the new CEO. Investors will be particularly keen to gain an insight into his strategy to counter the company’s well known problems, including the lack of drugs coming through from R&D to the market and generic competition.

We currently list AstraZeneca as a SELL

Diageo (Q2 results)

Investors will be looking for continued evidence of strong performance from its emerging market operations, some momentum in its U.S recovery and that the strength of its organic growth can be maintained. Any update on its three year plan and news on sales growth in China will be closely watched.

We currently list Diageo as a BUY

Companies also reporting today include Kazakhmys (Q4 results) – HOLD, Vedanta Resources (Q3 results) – BUY

Friday

Companies also reporting today include BT Group (Q3 results) – HOLD, Tate & Lyle (interim management statement) – HOLD

Economic Diary

30 January US Gross Domestic Product, Q4 2012 (Advance) – BEA

Today will see the first official estimate of US GDP in the final quarter of last year. In Q3 the US saw an annualised growth rate of 3.1%, according to the latest data. Recent Purchasing Managers indices and data on US personal income are consistent with lower growth in Q4. A growth rate less than 1.5% is a distinct possibility.

1 February US Employment Situation, January 2013 – BLS

Last month saw a 155,000 increase in non-farm labour in the US. In fact each of the last six months has seen in excess of 100,000 new jobs, while last year US unemployment fell from 8.3% in January 2012 to 7.8% in December. But for all the improvements seen last year, the overall picture remains one of disappointment, so did 2013 get off to a better start?

Other economic announcements include:

28 January

  • Money supply euro area, M1, M2, M3, December – Eurostat
  • Wealth in Great Britain Wave 2, The Burden of Household Debt in Great Britain –ONS

29 January

  • US Consumer Confidence, January 2012 – Conference Board

30 January

  • Sectoral breakdown of aggregate M4 and M4 lending, December 2012 – Bank of England
  • Lending to Individuals, December 2012 – Bank of England

31 January

  • US Personal Income, December – BEA
  • Economic Review, January 2013 – ONS

1 February

  • Flash Estimate Euro area inflation, January 2013 – Eurostat
  • Unemployment, December 2012 – Eurostat
  • Insolvency Statistics, Quarter 4, 2012 – ONS
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 Advice team arrive at their views please read our Investment Research Policy.

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