Nick Raynor, investment adviser at The Share Centre, gives his thoughts on what to expect from companies reporting next week (w/c 24 January 2011).

Tuesday 25 January 2011

Severn Trent - Third quarter interim management statement

The utilities sector has been named by many as the most likely to see acquisition or merger activity during 2011. Severn Trent was the best performing water company in the FTSE during 2010 and this may be a feat the company struggles to maintain during 2011. This update could prove us wrong but investors will be hoping to see a positive outcome and reassurance that the dividend will remain intact.
HOLD.

Babcock International - Interim management statement

Back in November Babcock International released a reasonably positive statement, noting it had won new contracts and that the integration of VT Group was going well. This will be a short update and we are hoping for much of the same. There have been changes at the top as Lord Hesketh resigned as deputy chairman, but that shouldn't detract from the company's performance and future potential.
BUY.

Wednesday 26 January 2011

Johnson Matthey - Interim management statement

The speciality chemical company looks set to post a reasonable update due to the rising price of platinum and positive markets for the products that Johnson Matthey produce. The share price has been on a terrific march for the last six months and now looks as it may have peaked at the 2,000p level. We are ‘holders' for now and eagerly await the update.
HOLD.

United Utilities - Interim management statement

Much the same to be said for United Utilities as with Severn Trent; the sector is expected to be the most likely for mergers and consolidation. Investors will want to see that the very reasonable dividends on offer continue. The cold winter snap may have caused some problems for water companies, but we have seen little bad news reported prior to this update.
HOLD.

Thursday 27 January 2011

BskyB - Interim results

Investors will be looking for news on the proposed takeover offer from NewsCorp, rather than looking at the underlying figures from this update. Last year BskyB produced impressive new customer figures at regular intervals and this may happen again, however the share price is unlikely to be affected as the takeover talk rumbles on.
HOLD.

3i - Interim management statement

This update will hopefully give us some idea of 3i's intentions for the year and whether they are going to be either very actively buying up companies or to gain value from current investments. It has been noticed that activity is currently slower than in the past, which in these potentially uncertain times is expected. We wait to see the outcome of this statement for any hints to this year's direction.
HOLD.

Cairn Energy - Trading statement

This update should shed some light on the Indian Government's decision on the proposed sale of 51 per cent of Cairn India Ltd to Vedanta for as much as £5bn. This money will come in handy as Cairn is looking to drill in the Greenland prospects that they have the rights for. It's not the end of the world if the deal falls through but it may have a short-term impact on the share price and if so is a great opportunity for investors to buy.
BUY.

Lonmin - Interim management statement

Political, personnel and the weather; all problems that Lonmin has had to face and the signs show its not getting better. This is a great shame as the price and demand for platinum seems to be on the increase. If in this update Lonmin have addressed some of the issues then we may be slightly more positive on the stock, however we doubt this and are confident that we will remain sellers.
SELL.

Friday 28 January 2011

Marston's - Interim management statement

2010 was a year of consolidation for Martsons; new pubs were built and profits were once again flowing. 2011 is expected to be much of the same, new buildings and projects are to be the main driver behind a hopeful profit surge and with this profit comes stability of the dividend. The company's shift towards food-driven pubs has helped and in this update we expect to see more encouraging performances.
BUY.