It’s another exciting week of results and updates, with retailers now jockeying with miners and bookies for headlines.
Monday 15 January
Rio Tinto, Watkin Jones
Tuesday 16 January
It’s been hit and miss this retail sector reporting season. Christmas was great for some, but a nightmare for others.
This week sees JD Sports (JD.) unveil its Christmas numbers. The company typically excels at this time of year as its share price performance shows. It’s why the stock always makes it into out interactive investor Winter Portfolios. JD shares are up an average of 29% over the past 10 winters!
And there’s been interest in the shares in the run-up to this update, the price gaining 11% in the past month and trading at its highest since the autumn.
Investec Securities tips the shares up to 475p (361p currently), arguing that the valuation is “undemanding for a European roll-out story more than capable of delivering high teens earnings growth for the foreseeable future, in our view, and is a play on the growing athleisure sector”.
Expectations are high, but JD normally delivers. In recent years, better-than-expected results have forced regular profit upgrades.
1pm, NCC Group, K3 Capital Group, Johnson Matthey, Ophir Energy, Greggs, JD Sports Fashion, Ashmore Group, Dunelm
Polo Resources Limited, Baring Emerging Europe, Plus500
Wednesday 17 January
Burberry, BHP Billiton
Majedie Investments, China New Energy
Thursday 18 January
Successful mediation talks between Royal Mail (RMG) and the Communications Workers Union avoided a hugely damaging strike in the run-up to Christmas. That Royal Mail shares have rallied 24% in the two months since is evidence of the massive cloud that hung over the business.
Top marks to analysts at Investec Securities who backed Royal Mail down at 389p in November. They’ve just reached 466p, a one-year high. The broker still thinks they can hit 500p.
Last month, Investec said, “Stripping out £200 million for surplus London property, RMG trades at 4.8x EV/EBITDA, compared to its European peers on over 7x. We believe this discount is far too wide and reiterate our ‘buy’ recommendation.”
On Thursday, we’ll get an update on performance over the crucial Christmas period, which will determine the full-year outcome. We know letter writing and card sending is in decline, but parcels will be interesting. Is Royal Mail holding its own, or is competition eating away at the business.
But it’s been GLS, the continental Europe and Republic of Ireland parcel delivery operation, that’s driving performance – a “force for growth”, according to RMG chiefs. Both half-year revenue and volume was up 9% and operating profit 8%.
Ten Entertainment, Workspace, William Hill, Whitbread, Royal Mail, Headlam, Halfords, NewRiver Retail, Experian, Associated British Foods
Standard Life Equity Income Trust, Keystone Investment Trust, Equatorial Palm Oil, Avacta Group
Friday 19 January
Character Group, Megafon
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.