The Week Ahead: Schroders can give the City something to cheer
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Your support makes all the difference.Deutsche Bank is certainly betting on a solid performance from the fund manager. On Friday, it urged its clients to buy into the stock, convinced that Schroders continues to perform well, driven by the recent strength in equity markets on both sides of the Atlantic. In fact, Deutsche raised its earnings forecast for 2006 by 16 per cent.
As for tomorrow's interims, the German broker predicts Schroders will unveil a pre-tax profit of £112m, up from £65m last time. It also hopes the asset manager will boast of a healthy inflow of cash into its various funds.
TODAY: Brokers rushed to upgrade their forecasts for Michael Page after its recent trading statement. Among them was Altium Capital and although it expects today's first-half figures to be strong, it does not expect further upgrades will be required in the wake of the figures.
Altium believes that the recruitment group's impressive performance at present is a product of its strong brand, its exposure to the financial services sector and the fact that it kept its European offices open during the difficult times, when others closed theirs.
Thanks to this brave decision, Michael Page should report a 42 per cent increase in net income at its European operations, while growth in the UK is expected to come in at about 20 per cent, well ahead of peers. For the first half, investors can expect Michael Page to deliver a whopping 81 per cent rise in earnings before interest and tax to £32m.
Last week, Credit Suisse First Boston upgraded its forecasts for the recruitment group and argued that its shares are undervalued given the growth the company is experiencing at the moment. CSFB said: "With exposure to high-end specialist staffing markets, a bias towards permanent recruitment and a high proportion of the accountancy market, we believe that Michael Page is ideally placed".
Results: Full year - None. Interims - Michael Page; Raymarine.
TOMORROW: Rok Property Solutions develops commercial, industrial, retail and leisure premises and has managed to sustain an impressive growth rate in recent years. Numis Securities forecasts this to be more than evident in Rok's interim results. The broker believes the construction company will report a 15 per cent jump in first-half pre-tax profit to £5.7m tomorrow.
Shareholders should see the benefit of this quite quickly. Numis predicts the group will also herald a 20 per cent rise in its interim dividend to 4.3p per share from 3.6p. Rok has said in the past that it wants to raise its payout to investors so that it is more inline with the wider sector. Numis views Rok as a key sector pick in the construction industry. It points out that the company already has a strong order book - standing at £300m at the last count - and great visibility of earnings given its long-term partnerships.
Results: Full year - None. Interims - BPP Holdings; Schroders; Rok Property Solutions; Headlam.
WEDNESDAY: Results: Full year - None. Interims - Balfour Beatty; Financial Objects; Cyprotex.
THURSDAY: Not so long ago, Weir Group warned that its first-half results would be marginally behind those achieved last year. Williams de Broe expects the pumps maker to post an interim pre-tax profit of £23m, down from £23.5m, and warns that the group will need a strong second half performance if it is to meet current City forecasts. For the full year, Williams de Broe hopes Weir will deliver a pre-tax profit of £61m.
Results: Full year - None. Interims - Weir Group.
FRIDAY: Panmure Gordon will announce its first results since its merger with Durlacher in April. There are no forecasts in the market for Panmure Gordon's first-half results. The first four months in the figures will reflect the performance of the Durlacher businesses alone, while the last two will be for the combined group.
The tie-up brought together two long established City names with little overlap. It aimed to blend together a strong secondary business and corporate client base with an AIM- focused broker in the hope of creating a more diversified business with higher margins. The combined company now has more than 100 corporate clients and should have annual revenues of about £35m.
Results: Full year - None. Interims - Panmure Gordon.
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