Some key October company news that you may want to watch out for.
The FTSE 100 (UKX) has been held back in September by worsening economic conditions in Spain, and rising unrest both there and in Greece as austerity measures start to bite. But underlying UK company performance in many cases seems to be strengthening. And while we have a relatively quite October from a 'company news' point of view, there are certainly some worth watching out for during the month...
High-street strength -- 11 October
WH Smith (LSE: SMWH) is one of those rare beasts -- a high-street business whose performance has held up well during the recession. In fact, earnings and dividends have been rising steadily, and the share price has more than doubled to 638p from a 2008 low of 295p. And part of that has been due to a recent surge that has seen the price gain 35% from around 470p in June.
But even after all that, full-year forecasts put the shares on a modest price-to-earnings (P/E) ratio of 10.4, falling to 9.4 for 2013, with a dividend of 4.2% expected (2013: 4.7%). Oh, and the point of it all is that those results will be out on Thursday 11 October. A pre-close update in August told us that the firm expected its performance to hit the top end of then-current forecasts.
Stopping the slide -- 24 October
Home Retail Group (LSE: HOME), the troubled owner of Argos and Homebase, is due to release interim results on Wednesday 24 October. It's been through the wars over the past couple of years -- no sooner had it managed to put a stop to the slide at Argos, than bad weather hit Homebase sales, which were down 6.2% at the time of the firm's Q2 statement on 13 September.
The shares have slipped by around 20% over the past 12 months, to 90p, and are way down on their £4 levels of 2008. But even after that, they don't look cheap by traditional measures -- they're on a P/E of over 15, with a dividend of a fairly modest 3.5% expected. The current glitch at Homebase was beyond the firm's control, but we really should want to see, over the next six months, that the rot really has been halted, and look for some evidence of an upswing in business
Department store progress -- 25 October
While other high-street retail shares have floundered, department store Debenhams (LSE: DEB) shares have soared by 75% over the past 12 months to 102p -- yet they're still only on a P/E of 11, which seems fairly modest. Mind you, the shares did slide from around £1 in 2009 to a low last year of 51p, so what we've seen is a recovery -- but it's a better recovery than many others have managed.
On Thursday 25 October, the company will present us with its full-year results, and according to the recent trading statement we should be seeing "strong like-for-like sales growth", with pre-tax profit ahead of last year and in line with forecasts. Debenhams is also reducing debt and buying back shares, so we should look for further details of those when we get the figures.
Important third quarters -- 25 October
Thursday 25 October is also a big day for third-quarter updates -- there are others the same week, but I've picked this day to watch because we will be hearing from both AstraZeneca (LSE: AZN) and Unilever (LSE: ULVR), both of which are key components of many a long-term portfolio.
AstraZeneca shares have had a rocky ride this year, slumping from January but then picking up again from June to stand today at around £29.60. Earnings are expected to fall this year, but there's a dividend yield of 6% forecast from the shares on a P/E of 8. What's needed is for confidence in the firm's research pipeline to return, so any news along those lines will be welcome.
Unilever, meanwhile, has climbed nearly 15% over the past 12 months to £22.70, and is currently on quite a high valuation with a forward P/E of 18 for the year-end. It's often bought as a safe long-term share, but it could be going through an overvalued phase right now.
Puffing away -- 30 October
Smoking might be a mug's game, but investing in Imperial Tobacco (LSE: IMT) certainly hasn't been. Since 2009, the shares have risen from £14 to today's £23, for a 64% gain, and that's been topped up with nice dividends into the bargain -- although the price has been higher, at £26, as recently as July.
Tuesday 30 October is expected to bring us more of the same when the company releases its latest full-year results. We already know from last week's trading statement that things are in line with expectations and that total revenues are going to be up around 4%.
We should see a dividend of around 4.5%, and that's expected to rise to 4.9% next year. At 11.5, the P/E looks undemanding, so the fall from this year's peak share price might well be a buying opportunity.
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> Alan does not own any shares mentioned in this article.