The Week Ahead: Debenhams and JD Sports

Published in Investing on 8 April 2011

It's another week of retail news ahead -- will we see more train wrecks, or is there light at the end of the tunnel?

There has been little of cheer amidst news of the high street in recent weeks, though Marks & Spencer (LSE: MKS) did manage to surprise the doomsters on Wednesday. Next week, we'll see if Debenhams (LSE: DEB) can do the same, as it releases an interim statement on Thursday.

M&S did owe its relative success to its famous range of foods, mind, and Debenhams doesn't have that staple to keep it sustained. But recent analysts' forecasts are suggesting a modest rise in profits this year, and a dividend yield of about 4.5%. Will Debenhams be another trend-bucker, or will it add woe upon retail woe? We shall see.

Fancy rags

There will be other retail stories coming in during the week, with full year results from JD Sports Fashion (LSE: JD) on Wednesday. Not to be confused with the basket case that is JJB Sports (LSE: JJB), JD has so far weathered the economic storms quite well. A fairly flat year is expected -- but these days, a flat year is a relative success.

Online fashion retailer ASOS (LSE: ASC) will provide us with a year-end trading update on Wednesday, and it is expected to be another strong year. Based on the latest analysts' forecasts, the shares are currently on an eye-watering P/E of 70, which would surely turn the Montgolfier brothers green with envy.

How do the shares stay up there? I have absolutely no idea, and though none of my predictions of a price crash has yet come to pass, I stick to my opinion that there is one around the corner somewhere.

Papers and pubs

Again on the high street, we're expecting interim figures from WH Smith (LSE: SMWH) on Thursday. Although many investors might see WH Smith as a bit of a plodder and not give it a second thought, with its split into its high street and travel divisions, it's actually been doing quite well.

If the analysts are anywhere near close, there's a full-year dividend of 5% on the cards, and the shares are on a prospective P/E of under 9. It's the high street, though, so the share price has the disaster factor built into it -- let's hope the pessimism is wrong.

Other results during the week will include half-time figures from Punch Taverns (LSE: PUB) on Monday. The actual numbers will be pretty much overshadowed by last month's news of the company's pending split, though they will most likely emphasise why some sort of drastic action is needed.

The AGMs get going

Next week sees AGM season starting to get into swing, with perhaps the most notable one being BP (LSE: BP), in Thursday. With the company on the verge of resuming drilling in the Gulf of Mexico, it will be the cap to a very traumatic year. And while the finances of the company will be foremost in most attendees' minds, spare a thought for the families of the 11 who died in the Deepwater Horizon explosion.

Other AGMs include the bingo and casino operator Rank Group (LSE: RNK), and medical hardware specialist Smith & Nephew (LSE: SN), both also on Thursday. Do you ever attend an AGM as a shareholder? If you do, why not tell us about it on the Fool's discussion boards?

Notable announcements next week:

Monday: Alliance Trust, Carr's Milling Industries, Punch Taverns, Michael Page International

Tuesday: No notable announcements

Wednesday: JD Sports Fashion, Smiths News, ASOS, Fresnillo

Thursday: Ideal Shopping Direct, Debenhams, Namakwa Diamonds, WH Smith, Ashmore Group, Eaga, Filtrona, Rank Group, BP

Friday: Record, Ladbrokes, PZ Cussons

Fool comment on this week's news:

> Disclosure note: The Motley Fool owns shares in Record.

Share & subscribe


The opinions expressed here are those of the individual writers and are not representative of The Motley Fool. If you spot any comments that are unsuitable hit the flag to alert our moderators.


There are no comments yet - why not be the first?

Join the conversation

Please take note - some tags have changed.

Line breaks are converted automatically.

You may use the following tags in your post: [b]bolded text[/b], [i]italicised text[/i]. All other tags will be removed from your post.

If you want to add a link, please ensure you type it as as opposed to

Hello stranger

To add your own comment, please login.

Not yet registered? Register now.