The latest instalment of oil market woe comes from BP Plc (LON:BP.) as it releases results for the first quarter of 2016.
Market consensus is for net income of just US$140mln.
Royal Bank of Canada (RBC) in a note highlighted that the dividend would be a key focus for investors.
“BP usually formally reviews its dividend in Q1 and Q3 each year, but in the current environment we suspect it is reviewed on a quarterly basis,” RBC said in a preview note.
“We believe BP can fund the dividend out of its balance sheet in the near term, but at current oil and gas prices is unlikely to cover it organically, which limits potential for yield compression in the near-term.”
British American Tobacco first quarter results expected to be ‘decent’
British American Tobacco (LON:BATS) is also in the schedule to lift the lid on the first quarter of 2016, and Jefferies reckons the numbers will be ‘decent’.
Martin Deboo, Jefferies analyst, in a note said: “Valuation normality is returning, sparked by an improved EM fx environment and a stonking 2015 result ex. currencies.
“But there is plenty of valuation headroom left, relative to better FY16 earnings optics, and margin and cash runway beyond that.”
Currency may be a key factor, as Deboo highlights that the 2015 earnings comparative was flat on an ‘actual currency’ basis, whilst the same period is expected to be up by ‘double digit’ percentages.
Whitbread: Are Premier Inn & Costa Coffee going off the boil?
The Premier Inn and Costa Coffee owner Whitbread plc (LON:WTB) releases final results and investors will be keen to see relative performance of the two big brands which have recently seen softer like-for-likes.
Last week, Berenberg repeated a ‘buy’ recommendation but cut its price target to 5,000p from 6,000.
“We continue to assert that the current price underappreciates the structural growth opportunity for Whitbread, and creates a valuation anomaly that will unwind as current negative sentiment eases and the prospect of multi-year double-digit earnings growth is again recognised,” said Stuart Gordon, analyst at Berenberg.
Tuesday’s stock market diary
Finals: Boohoo.com, Cambian, Horizon Discovery Group, Whitbread
Interims: Redefine International
Trading statements: BP Plc (LON:BP.), Carpetright; Countrywide; Petra Diamonds, British American Tobacco, Jardine Lloyd Thompson, St. James's Place; Standard Chartered