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The Markets
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The Markets
by Proactive
Proactive UK has moved.
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Pharma & Biotech

Week ahead - UK housing under the spotlight - again

Some big names report next week, including house builders Barratt Developments, Bovis and High Street bookies Ladbrokes.

Some big names report next week, including house builders Barratt Developments (LON:BDEV), Bovis (LON:BVS) and High Street bookies Ladbrokes (LON:LAD).

Also in focus will be consumer goods firm Reckitt Benckiser (LON:RB) and utility giant and British Gas owner Centrica (LON:CNA)

The housing shortage is always a big topic politically and economically and certainly some of our best known giants have been making hay while the sun shines.

But they have also faced their problems with a slowdown in the UK economy and problems in the construction sector. So what's next for these titans? Perhaps we will get a clue this week.

Peel Hunt rates Persimmon (LON:PSON) 'add' and has a target price of 2,180p ahead of its reporting to the market on Tuesday.

Analyst Clyde Lewis said: "While we don’t expect much in the way of trading surprises, we do expect the group to announce a capital return of 120p for 2016, vs the 10p to which the revised plan pointed."

"Persimmon is pushing for a modest amount of growth over the medium term, more than the two other majors, but its land bank and balance sheet are such that there should still be plenty of excess cash on the balance sheet once the capital return is completed in 2021.

Its shares have performed the best (or least worst) of the big housebuilders, he notes.

Bovis, on the other hand, it rates as 'hold' with a target of 1,040p.

"We expect Bovis to produce an 8% increase in volumes and a 16% growth in revenue for 2015, with margins increasing modestly to 17.2% from 17.0% in 2014. This should give a PBT of £159m, up from £133.5m in 2014," said the broker.

On Wednesday, Barratt reports and Peel also has a 'hold' stance and 640p target price.

"With a shorter land bank and weaker balance sheet than Persimmon, Berkeley or Taylor Wimpey, the scope for Barratt to return excess cash is lower," it notes.

"Despite that, it has made a commitment to pay out fairly high levels of cash in the medium term."

Bookie Ladbrokes reports results on Tuesday and Peel Hunt has a 'buy' rating and 135p target price.

"2015 should represent the nadir of the group’s fortunes and most attention will be focused on progress with the digital strategy and the self-help within UK Retail. It is early days, but we will be hoping to see some tangible progress in the turnaround.

"In terms of numbers, we are looking for 2015E EBIT of c£71m, down from £125m."

Ahead of Centrica's fourth quarter results, broker The Share Centre rates shares a 'hold.

"Like many energy related groups the share price has remained under pressure over the last year and is now at a 10 year low. The mild weather so far this winter is likely to have hit demand. Investors will therefore be keen to hear an update on its strategic review, which was announced last year. There will also be a focus on its operating cash flow as a result of the fall in gas prices and cost cutting measures."

Significant announcements

Monday

Finals

Acacia Mining

Fidessa

Hammerson

Reckitt Benckiser

Bovis

Tuesday

Finals

Anglo American

Spectris

Persimmon

Interims

A & J Mucklow

Wednesday

Barratt Developments

Thursday

Finals

BAE Systems

Centrica

Rexam

Interims

Go-Ahead Group

Q4 Results

Lancashire Holdings

IMS Darty

Friday

Finals

Coca Cola HBC AG

Essentra

Millennium & Copthorne Hotels;

SEGRO

Standard Life

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