The week ahead (06/09 - 10/09/10)

The week ahead (06/09 - 10/09/10)

This week sees the corporate calendar break free of the summer lull, with a whole host of familiar faces and the odd new name to whet investors' appetites.

Online grocery retailer Ocado makes its debut on Tuesday and the pressure is on after its rocky start in July was followed by a further blow last week when Morgan Stanley analyst Geoff Ruddell said its online market was likely to reduce rather than grow. 

While Ruddell maintained he was a big fan of the brand's customer proposition, he was less enamoured with its business model and tagged it with an 80p price target - valuing the group at less than half its initial public offering price.

Ocado, which delivers Waitrose food, will no doubt be looking to use Tuesday's results as a chance to win back some much needed support and assure investors of its future.

Whitbread  also takes to the stage on Tuesday with a trading statement likely to strike an upbeat tone. The Premier Inn brand has seen a positive turnaround recently and momentum is expected to continue. Furthermore, the company's Costa Coffee chain's popularity continues to make headway which should add a further boost to its report.

Shareholders in confectionary giant Thorntons are bracing themselves for an altogether less sweet interim statement 24 hours later.

Thornton's reported its fourth-quarter trading figures in July, following on from the profit warning it had issued weeks previously and pointing towards a pre-tax profit of £6 million. Analysts continue to sound caution over the role of supermarkets taking further share, eroding Thorntons's own-store profitability.

Housebuilder Barratt Developments is also up for the taking on Wednesday and the focus will be on the group's sales figures given the recent uncertainty surrounding the housing market.

Analyst Chris Millington at Numis comments: 'We expect the company to report EBIT over £85 million, which implies a H2 2010 EBIT margin of over 5.5 per cent. Net debt is expected to be £375 million. The market will be focused on Barratt's sales rate and pricing profile over the summer and whether the group feels confident of delivering the 5-10 per cent volume growth in its previous guidance.

'In our view the shares are too cheap and are pricing in a severe correction in UK house prices - a view we do not adhere to.'

Thursday sees a barrage of names jostling for the spotlight, starting with Home Retail Group. The owner of Argos and Homebase may have benefited from a last- minute surge in BBQ sales and back to school sales, but the figures are still not expected to be brilliant.

Hot on its heels come supermarket Morrisons which kicks off the trolley wars with its interim results. Competition has been fierce among the supermarkets as they fought to retain customer loyalty through the world cup and long summer, but there is optimism Morrisons made some headway over its rivals.

The results will also be a chance for new chief executive Dalton Philips to present his initial thoughts on the business.

Sam Hart, analyst at Charles Stanley, says his approach is likely to be evolutionary, given that Morrison already appears to be on the 'right strategic path' and that he was specifically recruited to apply his operation expertise.

'Underlying trading is expected to have been solid during the period. Like-for-like sales are forecast to be up by 0.9 per cent during the first half, with growth in the second quarter likely to have been similar to the 0.8 per cent reported for the first quarter. Investor sentiment towards the food retail sector has been cautious in recent months but we expect (it) to gradually improve going forward as food price inflation returns and like-for-like sales growth accelerates,' he adds.

High street entertainment store HMV will also air its wares on Thursday and after having its work cut out this year with a 35 per cent drop in share price, shareholders are hoping for signs of stability. Its shares have remained seemingly steady over the past month and in its most recent results, the group said it was confident it could rebuild profits at Waterstone's and deliver underlying profits in HMV.

While its interim statement is unlikely to set its share price racing, it should hopefully provide confirmation that sales are getting back on track.

The week is brought to a close with JD Wetherspoon's finals. After reporting like-for-like sales rose by 1 per cent in the 11 weeks to July, the pub operator is not expected to report any catalysts, although modest improvement is nonetheless expected.

The economic calendar is looking equally eventful next week, with the Bank of England monetary policy comittee's decision on Thursday being the headline act.

On Thursday, the MPC will release its decision on interest rates and quantitative easing and analysts widely expect the interest rate to be kept down at 0.5 per cent for the 18th successive month. While member Andrew Sentance is likely to maintain his stance that a small rise is justified, he is likely to stand alone.

Howard Archer, chief UK and European economist at IHS Global Insight, comments: 'We suspect the other eight MPC members will conclude that the serious headwinds facing what is still overall muted recovery from very deep recession warrant unchanged interest rates. Indeed, if the MPC does make any adjustments to monetary policy in the near term, it is most likely to be to revive quantitative easing which has been on hold since February.

'The Bank of England is clearly concerned by the threat to economic activity stemming from persistently tight credit conditions, and latest news on this front remains worrying.'

Also this week, the BRC Retail Sales Monitor for August is published and is likely to show that the high street held up well over the summer.

While the report is set to be slightly less upbeat than the previous CBI Distributive Trades Survey, a recent run of strong evidence from the retail sector should see like-for-like growth in the region of 1 per cent.

Finally, PPI August input and output prices make their debut on Friday and should provide further evidence to suggest that a peak in producer price inflation has passed.

Economists at Capital Economics comments: 'Admittedly the recent surge in wheat prices should lift food input price inflation, nonetheless the pick-up in agricultural prices has so far been much smaller than during the food crisis of 2007/08. Moreover, the ongoing drop in annual oil price inflation should act to offset the inflationary effects of the rise is food price inflation.'

They added that a robust recovery in the manufacturing sector should help keep output price inflation around the 5 per cent mark for a few months yet.

Monday 6 September

Results

(Finals) Craneware, Kofax, Murgitroyd Group, WFCA

(Interims) Brady, Goals Soccer Centres, Hellenic Carriers, Hydrogen Group, OAO Severstal, Staffline Group, Straight, Symphony Environmental Technologies, Titan Europe, Verona Pharma

AGMs

Ecofin Water & Power Opportunities, Marwyn Value Investors, The Clapham House Group

EGMs

BT Group, Solid State

Dividend payment date

(Interim) Fenner, St. Modwen Properties

Tuesday 7 September

Results

(Finals) Abcam, Dechra Pharmaceuticals

(Interims) Charlemagne Capital, Globaltrans Investment, Hydro International, Ocado

(Quarterly)Ashtead Group

AGMs

Ashtead Group, Daisy Group, DS Smith, Greene King, Hampson Industries, Midas Income & Growth Trust, Quintain Estates & Development, Sports Direct International

Wednesday 8 September

Results

(Finals) A&J Mucklow, Avingtrans, Barratt Developments, CPL Resources, Interior Services, Thorntons

(Interims) Advanced Medical Solutions, Alkane Energy, Alliance Pharma, Cape, Futura Medical, Lupus Capital, Prezzo, SQS Software Quality Systems, Ukrproduct Group, Valiant Petroleum, Zenergy Power

AGMs

Artemis Alpha Trust, Avisen, Berkeley Group Holdings, DSG International, Eredene Capital, Probability, ReNeuron, Warner Estate Holdings

EGMs

Berkeley Mineral Resources

Dividend payment date

(Final) Cohort, Creston

(Interim) Law Deventure Corp., Nichols

(Quarterly) Royal Dutch Shell

Thursday 9 September

Results

(Finals) Alumasc Group

(Interims) DataCash Group, HMV Group, IG Group Holdings, Premier Farnell, Tikit

(Quarterly) Ocean Power Technologies

AGMs

Assra Group, Atkins, Carpetright, Falkland Islands Holdings, Hartest Holdings, HMV Group, Invista Foundation Property Trust, Matrix Income & Growth 2, Naya Bharat Property Company, Northgate, PHSC, Polar Capital Holdings, Provexis, Southern Beat, Western Coal Corp., Zoo Digital

EGMs

Naya Bharat Property Company

Dividend payment date

(Final) Carclo

(Interim) Development Securities, F&C Inv Trust, New Europe Property Investments, Rio Tinto

Friday 10 September

Results

(Finals) JD Wetherspoon

AGMs

Cyril Sweett, Ebiquity, Invesco English & International Trust, IPSO Ventures, Latchways, Yangtze China Investment

Dividend payment date

(Final) Ashtead Group, Newmark Security, Northumbrian Water Group

(Interim) Anglogold Ashanti, BG Group, Charter International, Elementis, Morant Wright Japan Income Trust, Porvair, Rank Group

(Quarterly) Barclays, Canaccord Financial, Carnival