Week three of the February reporting season is going to be very busy with a plethora of companies reporting their earnings.
Some of the most eagerly awaited and important results investors should watch out for this week include:
Monday:
JB Hi-Fi Limited (ASX: JBH) – Although the retailer's underlying profits will be of interest, I suspect investors will be more interested in how its tie-up with the Good Guys is progressing. It will be the first time JB Hi-Fi will have updated the market since the acquisition was completed last November.
Tuesday:
Challenger Ltd (ASX: CGF) – Challenger shares are up more than 53% over the past 12 months which means the market will be expecting another strong result from the annuity provider. Consensus estimates provided by CommSec suggest investors should expect net profit after tax (NPAT) of $188 million and an interim dividend of 17 cents per share.
Cochlear Limited (ASX: COH) – Shares of the bionic ear maker are trading on a price-to-earnings ratio (PER) of more than 35 so its needless to say it must meet or beat market expectations to avoid a harsh sell-off.
Wednesday:
a2 Milk Company Ltd (Australia) (ASX: A2M) – a2 provided a strong trading update in late December so I don't think investors will be expecting any nasty surprises when it reports its first half results. With that said, the market will be very keen to find out how sales have progressed over the first six weeks of 2017 and whether or not the positive momentum has continued.
Domino's Pizza Enterprises Ltd. (ASX: DMP) – Domino's shares have been under the pump recently but still trade on an eye watering PER of more than 50. The pizza maker has a history of beating market expectations and will need to do this again to reverse the recent share price trend.
Wesfarmers Ltd (ASX: WES) – Wesfarmers is going to deliver a strong uplift in earnings from its resources division but the market will undoubtedly be more focused on how its retail operations are progressing. Investors will also hope for strong results from its newly established UK home improvement business.
Commonwealth Bank of Australia (ASX: CBA) – Australia's biggest bank is expected to deliver first half profits of $4.8 billion and declare a flat interim dividend of $1.98 per share. Cost control initiatives, the level of bad debts and its net interest margin will be the key focus for investors.
Thursday:
Telstra Corporation Ltd (ASX: TLS) – The telco giant isn't expected to deliver any huge uptick in earnings when it reports, although investors will be hoping for a small interim dividend increase. Further updates regarding the NBN and its impact on operations will also be keenly anticipated.
Sydney Airport Holdings Ltd (ASX: SYD) – Traffic numbers have been consistently strong for Sydney Airport so the market will be expecting another impressive half-year result. Due to the unique features of infrastructure assets, investors should focus on the airport's EBITDA result and whether management provides any further commentary regarding the development of the Western Sydney airport.
Friday:
Medibank Private Ltd (ASX: MPL) – Expectations for the private health insurer are pretty low but the market will still be keen to find out if the company has been able to stop the loss of policyholders. The first four months of trading was below management's expectations, although shareholders will hope revenue growth has improved since then.
