NVIDIA, Marks and Spencer, Royal Mail

Our regular look at the FTSE 350 and a selection of other companies reporting from 20 – 24 May.

• NVIDIA pointing to further strong growth in first quarter.
• Marks & Spencer’s continued turnaround success expected.
• Interest rate cuts should ease headwinds at British Land
• National Grid hoping to deliver electrifying numbers in its full-year results.
• Is Royal Mail set to leave the London Stock Exchange?

NVIDIA, Q1 Results, Wednesday 22 May

Derren Nathan, head of equity research, Hargreaves Lansdown “NVIDIA’s [NASDAQ:NVDA] expected to build on the blistering growth experienced in the final quarter of last year. Company guidance points to first quarter revenue of around $24bn, more than three times the levels seen at the same point in 2023. Analyst forecasts expect sales to come in slightly higher. NVIDIA’s at the forefront of Artificial Intelligence based supercomputing. Beyond the obvious large Data Center customers, it’s working closely with sovereign states and academic institutions. In certain cases, the technology rollout has accelerated from a period of years to just months.

But there are potential headwinds for other segments. Some semiconductor companies have noted weak demand from the automotive industry and, in gaming, the lack of next generation console releases could keep a lid on sales. However, these are much smaller than the Data Center division. Here, investors will be keeping a close eye on manufacturing partners’ ability to keep up with NVIDIA’s momentum.”

Marks and Spencer, Full Year Results, Wednesday 22 May

Guy Lawson-Johns, equity analyst, Hargreaves Lansdown “So far, trading this year has given Marks and Spencer [LON:MKS] shareholders plenty to be happy about. Growing market share and margins whilst embarking on a significant cost-cutting programme is a tough balancing act, but the group’s nailed it so far. Along with Lidl and the retail arm of Ocado [LON:OCDO], which it owns a 50% share of, M&S is ranked as Britain’s fastest-growing grocer over the last quarter.

But the retail sector is a notoriously tricky operating environment and wage inflation and business rates have provided an unwanted challenge to its cost cutting programme. Despite this, next week’s full-year results are still expected to land in line with analyst estimates. This includes revenue growth of 8.9% over the year, to £13bn, and operating profit growth of 28.5% to £805mn.”

British Land Company Full Year Results, Wednesday 22 May

Susannah Streeter, head of money and markets, Hargreaves Lansdown “Corporate landlord, British Land [LON:BLND], had a much better first half than expected and, with the leasing environment looking robust, it bodes well for the full year results. The company’s ‘campus’ portfolios, combining topflight office facilities with retail, leisure and hospitality facilities have seen occupancy rate jump back into the 90% bracket.

Renewals by big names, like Meta Platforms [NASDAQ:META], show demand for high quality space remains. With more workers returning to offices and more stable patterns emerging, it should help with resilience going forward.

Urban logistics sites are another source for future growth, while its strategy of investing in retail parks is paying off, given that consumers preference to shop out of town rather than in high streets appears to be continuing. The high interest rate environment hasn’t been clement for the group as its pulled property valuations lower, but with interest rate cuts eyed on the horizon, those headwinds should ease.’’

National Grid, Full Year Results, Thursday 23 May

Aarin Chiekrie, equity analyst, Hargreaves Lansdown “National Grid [LON:NG.] is attempting to plant itself at the centre of the electric revolution. It’s selling off some of its gas assets to really focus its attention on electricity. Progress in driving the energy transition forward looks set to be supercharged by substantial levels of investment. These are expected to be in excess of £8bn when full-year results are reported next week.

In return for investing billions to maintain and upgrade its network, the regulator allows National Grid to earn a reasonable profit. Markets are expecting operating profits to rise around 11% to £4.8bn, which helps fund the group’s 5.4% forward dividend yield.

Given the shift in the interest rate narrative in early 2024, with rates now expected to remain higher for longer, investors are eager to understand the longer-term impact this has on funding these investments.”

International Distributions Services, Full Year Results, Thursday 23 May

Susannah Streeter, head of money and markets, Hargreaves Lansdown “These full year results come amid expectations that Royal Mail owner, IDS [LON:IDS], will be taken private and leave the London Stock Exchange. The board has said its’ minded to accept a takeover offer from Daniel Kretinsky’s investment firm, EP Group. It’s not too much of a surprise that this bid has materialised given how downbeat sentiment has been towards IDS in recent years, even though fortunes have been looking up more recently.

The group’s international arm, GLS, has long been considered the jewel in the company’s crown, enjoying a level of success which Royal Mail has found so elusive. Margin growth has come under pressure though in this part of the business of late, partly due to the insidious effects of inflation. However, GLS has still been growing revenue and it’s highly likely that EP Corporate Group sees plenty of long-term opportunities here.”

This article has been brought to you in association with Hargreaves Lansdown. All opinions expressed in this article are from the analysts and do not necessarily represent the opinions of The Armchair Trader.

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