Shares in Ashtead Group PLC (LON:AHT), the FTSE 100-listed construction equipment hire firm, have sunk 20% underwater since reaching high ground last year and ahead of full-year results on Tuesday have been quite bogged down.
Pressure has come from investor concern about a slowdown in the key North American market, which has been further aggravated by a profit warning from a construction services sector peer, which blamed high levels of rainfall in the US for a rash of delayed contracts.
Ashtead, which derives around 85% of its sales and 90% of profits from its US-based Sunbelt business, can take confidence from US rival United Rentals, which reported solid first quarter figures in April.
Despite headwinds from wet weather, analysts at broker Numis said they believe there is scope for Ashtead to beat its forecasts for pre-tax profit of GBP1.1bn.
“Peer United Rentals has twice outlined strong trading conditions since Ashtead last reported, with commentary confirming strong growth across all geographies and verticals. Ashtead has consistently outperformed its peer on a like-for-like sales growth basis,” the Numis analysts added.
Brighter future hoped for Telecom Plus
Moving to the second line, utilities firm Telecom Plus PLC (LON:TEP) provides an alternative to the more well-known suppliers of gas, electricity, telephone and broadband services through its Utility Warehouse brand, so investors will hope it has managed to take more market share when it reports its finals on Tuesday.
However, a profit warning in April is likely to dim expectations as the firm has suffered from the mild UK winter weather as well as the government’s energy price cap.
The FTSE 250-listed firm is currently expected to report an adjusted pre-tax profit for the year of GBP56mln, so investors will be hoping the company has at least managed to keep stable so it can take advantage of high levels of customer switching.
Analysts at Numis said that they will look for TEP’s competitive standing in the energy supply market as well as any evidence of the company using its size to leverage better terms from wholesale suppliers.
Higher occupancy eyed from Safestore
The FTSE 250-listed firm reported 6.4% like-for-like (LFL) growth in revenue in its first quarter alongside a 3.2 percentage point rise in occupancy rates to 73.5%, so investors will be hoping more punters have been locking up more of their stuff in the company’s storage boxes.
There may also be news of a successor to outgoing chairman, Alan Lewis, who previously announced his intention to step down from the firm.
Significant events expected on Tuesday June 18:
Interims: Safestore Holdings PLC (LON:SAFE), Schroder European Real Estate Investment Trust PLC (LON:SERE)
Economic data: US housing starts