FTSE 350 Look Ahead: J Sainsbury, Ocado And Persimmon

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FTSE 350 Look Ahead: J Sainsbury, Ocado And Persimmon
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Look ahead to FTSE 350 & other companies reporting from 5 to 9 July

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Q1 2021 hedge fund letters, conferences and more

  • J Sainsbury plc (LON:SBRY) will reveal if shoppers are filling up fewer online shopping baskets
  • Ocado Group PLC (LON:OCDO)'s international partners have launched their first CFCs
  • Persimmon plc (LON:PSN) will reveal whether it’s managed to up its build rates to meet strong post-pandemic demand

Sainsbury, Q1 Trading Statement, Tuesday 6 July

Susannah Streeter, Senior Investment and Markets Analyst

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"J Sainsbury rose to the challenge of helping feed the nation during lockdowns, but the costs of operating through the crisis seriously dented its bottom line. Retail sales, excluding fuel rose by 7.3% but underlying profits were down by 39%. We should find out if a revival of fortunes has materialised in the upcoming trading update. Underlying profits are forecast to grow, and the grocer says it’s comfortable with consensus expectations of £620m. The company has flagged high customer approval ratings for an in-store experience which should also bode well given that more shoppers have been venturing out once more, which may have helped the grocer retain new customers.  Another bright spot for J Sainsbury has been its ability to capitalise on the accelerated shift to digital with online grocery sales doubling during the year to hit £12.1 billion.  However, with the economy opening back up, the nation’s drift back to dining out, might eat into its revenues. ONS figures showed that there was a 5.7% fall in retail food sales in May, and as shoppers fill up fewer baskets, there is likely to be further competition on price, which could affect margins going forward.”

Ocado, Interim Results, Tuesday 6 July

Nicholas Hyett, Equity Analyst

“With Ocado now lapping the start of the pandemic, management have warned that “rates of sales and EBITDA [cash profits] growth in future quarters will reflect annualisation against periods of Covid-19 related lockdown experienced in FY20”. In other words, growth is expected to be slower at this set of results. Having said that, the recently opened Bristol Customer Fulfilment Centre (CFC), should provide a platform for year-on-year growth. CFCs launched for international customers in the solutions business are now up and running, with US partner Kroger opening its first CFC during the last quarter. Given the importance of International Solutions contracts to the group’s long-term profitability, performance here is far more important than a lacklustre quarter in UK retail.”

Persimmon, Trading Statement, Thursday 8 July

Steve Clayton, Manager of the HL Select Funds

“Recent news that Persimmon were providing redress to owners who had suffered from historic pricing of land rents grabbed headlines but won’t have much impact on the future of the Group. The housing market is marching higher and so far, price growth looks set to comfortably outpace cost inflation. So, Persimmon should be putting a pretty strong report in front of investors when they update the market at the half-way stage. It could get harder from here though – stamp duty cuts will finally wash out and there are signs of product shortages impacting the industry.”

FTSE 100, FTSE 250 and selected other companies scheduled to report next week

05-Jul

No FTSE 350 Reporters

06-Jul

J Sainsbury* Q1 Trading Statement
Ocado Group* Interim Results

07-Jul

Ferrexpo Q2 Production Volume
Vistry* Trading Update

08-Jul

Grafton Group Trading Update
Electrocomponents Q1 Trading Statement
Persimmon* Trading Update
PZ Cussons Trading Update
Watches of Switzerland Group Full Year Results

09-Jul

Victrex Q3 Trading Statement

*Events on which we will be writing research


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Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)www.valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver
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