Immupharma (IMM)


The week ahead...

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Car dealer Inchcape and soft drink manufacturer AG Barr are among a diverse mix of companies due to report over the coming five days. Find out what else is in store.

Monday 24 September

AG Barr (BAG) will open the curtains for the week with its interim results.

Recent news: On 5 September, Barr confirmed it had approached Britvic (BVIC) with a view to a possible merger, with Britvic shareholders owning 63% of the enlarged group and Barr's shareholders owning 37%.

Analysts' expectations: Despite the soft drinks category having been adversely affected by the poor weather in the UK, Damien McNeela, analyst at Panmure Gordon, is forecasting Barr to deliver c. 5% revenue growth to £129.7 million for the six months to 31 July, in line with the company's pre-close estimate of c. £130 million.

He believes that "the majority of any potential synergies from the merger with Britvic are reflected at current levels", thus rating the stock a 'hold'.

Valuation: AG Barr's shares have risen by 13% year to date, outperforming the FTSE All Share by 5.3%. The stock is currently trading on a 2012 price to earnings (PE) ratio of about 20 times.

This will be followed by first-half results from Escher Group Holdings (ESCH).

Recent news: At its most recent trading statement on 6 August, Escher commented that it has made "good" progress in the first half, with revenues expected to be c. $8.7 million (£5.4 million). A new office in Washington to support the current and developing customer base led to first-half costs being ahead of budget. The group cash position at 30 June stood at $4 million.

On 29 June, Escher announced the appointment of Jonathan Anthony O'Connell as the new chief financial officer, following incumbent Trevor McIntyre's decision to move to New Zealand.

Analyst expectations: Panmure Gordon's George O'Connor is expecting chief executive Liam Church to reiterate his view that "sales of systems to new customers leads the revenue mix, and the associated recurring income will become an increasingly material component of group revenues. We delivered a strong first-half performance and we remain confident about the outlook for the rest of the year".

Valuation: The shares are trading on a 2012 PE ratio of about 12 times, a valuation O'Connor says seems "very undemanding".

Trading statements

MAM Funds, Manganese Bronze Holdings, WANdisco, Lighthouse Group, Vphase, RGI International, Michelmersh Brick Holdings, DDD Group, China Food Company, EKF Diagnostics Holdings, AG Barr, Finsbury Food Group, Petra Diamonds, QinetiQ Group, Dairy Crest Group


SnackTime, iEnergizer, Max Petroleum, Angel Mining

Tuesday 25 September

Analysts are expecting a cautious outlook from car dealer Inchcape (INCH) when it reports on Tuesday.

Recent news: The first-half results showed the company was coping with known headwinds such as the UK and Europe.

Analysts' expectations: While recent data on the Russian market from the Association of European Businesses suggested the demand side of the equation remained intact, Panmure Gordon's Mike Allen believes that there is oversupply and pricing pressure in this market, along with a potential slowdown in Australasia.

With Russia accounting for 60% of revenues, and Australia another 20%, Allen has a 'hold' rating on the stock, stating: "We think the shares will pause for breath in the near term, but would look to turn more positive on any significant share price weakness from here given its unique business model and strong balance sheet."

Valuation: Inchcape is trading on a 2012 PE ratio of between 10 and 11 times.

Trading statements

PhotonStar LED Group, Judges Scientific, Bond International Software, Augean, InternetQ, KBC Advanced Technologies, Netcall, Hargreaves Services, CVS Group, Regenersis, Close Brothers Group, Albemarle & Bond Holdings, Daily Mail and General Trust


Private Equity Investor, Terra Catalyst Fund, Braveheart Investment Group, Zoo Digital Group, Daisy Group, Fulcrum Utility Services Ltd (FCRM)

Wednesday 26 September

With the first half typically generating only 20% of group profits, analysts are not expecting much in the way of trading news when Homeserve (HSV) issues its trading update.

Recent news: The recent annual general meeting confirmed Homeserve was making progress resolving its UK issues, although the Financial Services Authority (FSA) investigation was ongoing and likely to take many months to complete. Encouragingly, new partners had been added in the US, with retention levels staying high, suggesting that negative read-across from UK was not impacting its overseas operations.

Analysts' expectations: Consensus is expecting pre-tax profits for the full year to come in at £105.5 million.

Panmure Gordon's Andy Brown has a cautious stance on the stock, driven by "the uncertainties following its UK telesales issues and the subsequent, and ongoing, FSA investigation". He acknowledges that the company has a "decent" dividend yield of c. 5%, but says that to turn positive, he would like "better yield support".

Valuation: The share price had a spike upwards in mid-year due to speculation around private equity interest. It is currently trading on a 2012 PE ratio of about nine times.

Midweek will also see ImmuPharma (IMM) report its interim results.

Recent news: The company is in the process of finding a new licensing partner for lead product candidate Lupuzor after successfully regaining all rights from previous partner Cephalon.

Analysts' expectations: Savvas Neophytou, analyst at Panmure Gordon, is forecasting no revenues, resulting in an operating loss of £2.5 million and a pre-tax loss of £2.3 million.

"We believe investors should be patient and expect significant share price volatility in the coming weeks but, ultimately, from a purist valuation point of view, ImmuPharma shares are worth significantly more than the current share price," Neophytou says.

Economic news

The Confederation for British Industry (CBI) distributive trades survey for September is expected to point to moderate retail sales growth after it appears that they were hindered overall rather than helped in August by the Olympic Games.

Howard Archer, chief UK and European economist at IHS Global Insight, is expecting the survey to show that the balance of retailers reporting that sales were up year-on-year to have improved to +5% in September after relapsing to -3% in August.

Trading statements

S & U, Trap Oil, Dillistone Group, GVC Holdings, Acta, IQE, SciSys, Topps Tiles, ICAP, Homeserve, Domino's Pizza


Absolute Return Trust, Micro Focus International, WYG, Namibian Resources, Intercede Group, Sofia Property Fund, Sirius Exploration, Sweett Group

Thursday 27 September

Economic news

It will be heavy on the economic front on Thursday, with revised data released for GDP in the second quarter.

First revisions pushed up the second-quarter GDP estimates to -0.5% from -0.7%. Both Archer and Investec's Philip Shaw suspect the data will be adjusted in the same direction.

Thursday will also see data on the second-quarter balance of payments being released. The first-quarter current account deficit was recorded at £11.2 billion, about 3% of GDP.

Trading statements

Straight, WANdisco, Dolphin Capital Investors, Inditherm, SimiGon, Fairpoint Group, PureCircle, IndigoVision Group, Hansard Global, TUI Travel, Compass Group, Dolphin Capital Investors, Tate & Lyle, Euromoney Institutional Investor


Scotty Group, Toledo Mining Corporation, Park Group

Friday 28 September

Analysts are hoping for some detail on whether Australia and Asia Pacific are growing concerns when Hyder Consulting (HYC) reports its pre-close update on Friday.

Recent news: Last month, the company delivered a robust interim management statement, indicating that its order book remained particularly strong in the Middle East.

Analyst expectations: Allen thinks that there is scope for growth in Asia Pacific to slow next year, which is its largest profit contributor. Additionally, with growing macroeconomic uncertainty in both China and Australia, he believes the share price progress may be limited in the short term.

"While the valuation of the shares does not look demanding, the performance of late has been strong, and we think the risk/reward profile is not particularly attractive in light of this in the near term," he says.

However, he stresses that he is a long-term fan of the business "given the strong management team and balance sheet", adding that he "would return to a more positive recommendation on any significant share price weakness from here".

Economic news

The GfK/NOP consumer confidence index is expected to have edged up in September, but to still be very weak compared to long-term norms.

The consumer confidence measure has been glued to the -29 mark since May, its most dismal run in the survey's 40-year history. In fact, with the exception of a brief spike up in May/June 2011, the consumer confidence index has been locked in a -28 to -33 range since January 2011. This is among the lowest levels since the index started in 1974 and substantially below its lifetime average of -8.

Both Archer and Investec's Victoria Cadman are expecting the survey to edge up to -28, a 16-month high.

Trading statements

Goals Soccer Centres, Orchid Developments Group, Harvey Nash Group, Thomas Cook Group, Hyder Consulting


San Leon Energy, 600 Group, Sky High, Minera IRL, Impact Holdings, African Consolidated Resources, Infrastructure India, Eurasia Drilling Company.


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