Interactive Investor

The week ahead: Ladbrokes Coral, HSS Hire

25th August 2017 16:55

David Brenchley from interactive investor

Bookie Ladbrokes Coral kicks off interim reporting season in a shortened trading week. HSS hire also comes to the market in a quiet four days for corporates.

Monday 28 August

Bank holiday.

Tuesday 29 August

Trading Statements

Bunzl, Globaltrans Investment

AGM/EGM

Cadence Minerals, Bank Of Cyprus Holdings, Calculus Vct

Wednesday 30 August

Steve Ashmore steps up to the podium for his maiden set of interim figures as new boss of HSS Hire Wednesday.

Ashmore took over the reigns at the tool and equipment hire firm on 1 June, having been UK managing director of distribution at rival Brammer. He had previously been UK MD at plumber Wolseley.

Clearly, he's not been there for long, as he pointed out at July's Q2 update, but investors will be intrigued as to what details he will give on his plans to drive the business forward.

Broker Panmure Gordon left its first-half forecasts unchanged, and expects to see reported numbers dip in the first half before improving as the year progresses. It's reduced FY17 capex forecasts by £4 million, to £37 million, and reckons net debt for the year will come in at £202 million.

Shares have disappointed year-to-date and currently sit one-third below where they started January at 54p. However, Panmure analyst Adrian Kearsey has a 'buy' rating with target price of 115p on the stock.

Kearsey says the fact that HSS shares trade well below 1 times on a net book ratio indicates investors have turned their backs on the company. However, "we expect underlying revenue trends will encourage the peripheral buyer".

"That said, we acknowledge the higher depreciation charge will discourage some and that most investors are likely to wait until Ashmore."

Trading Statements

The Gym Group, HSS Hire, PureTech Health, Megafon, Cathay International Holdings, Fisher (James) & Sons, BATM Advanced Communications, Diploma

AGM/EGM

New Trend Lifestyle

Thursday 31 August

As we move into the interim reporting season, after investors' summer holiday period, bookmaker Ladbrokes Coral will be the first of the big guns to come to the market with a first-half update.

Broker Investec is expecting first-half revenue, operating profit and cash profit to come in at £1.2 billion, £156.7 million and £213.7 million respectively. Over the three years to FY19, analyst Alistair Ross expects a compound annual growth rate in earnings per share (EPS) of 23.1%

Last month the firm upgraded guidance on expected annual synergies from the November merger that created the entity to £150 million, but Investec left its original forecast of £107.5 million intact.

On the horizon, the government's triennial review, which will focus on fixed-odds betting terminals, is one development to watch out for, expected to be published in November. This could impact on LCL's EPS, as it is one of the firm's largest revenue sources.

Still, Ross likes the company and believes the shares "remain fundamentally undervalued". He has a 160p target price on the stock. Ladbrokes Coral is currently trading flat on the year at 116p.

Trading statements

Total Produce, Restaurant Group (The), STV Group, Alfa Financial Software Holdings, Ladbrokes Coral, BBGI Sicav, Arrow Global, Chesnara, Hays, Churchill China

AGM/EGM

Simian Global, Highlands Natural Resources

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.