Lloyds

The bank is expected to report strong earnings but loan activity may have weakened in the final quarter

When Lloyds (LLOY) updated the market on trading for the nine months to September 2022, there was no hint of the turmoil which was about to erupt in financial markets or the sudden spike in borrowing rates.

Higher rates are generally good for banks, but shocks to the system aren’t which means Lloyds’ fourth quarter and full-year results on 22 February will be closely watched by the market. It will be instructive to see how companies and consumers reacted to the higher interest rate environment and whether Lloyds’ loan book took a knock in the final three months of the year.

After its third-quarter earnings beat expectations, Lloyds raised its full-year net interest margin and return on equity targets, and analysts expect chief executive Charlie Nunn to announce pre-tax profits of more than £7 billion as well as, potentially, a sizeable share buyback given the bank’s strong capital position. [IC]

Rolls-Royce

A £2 billion disposal programme was completed in September improving the balance sheet

At the start of 2022 analysts were penciling in over £400 million of full-year net profit for Rolls-Royce (RR.) but that has since collapsed to £57 million.

Despite this gloomier earnings situation, the shares have gained more than 25% over the past three months suggesting optimism over
the recovery potential for the business. In November the company maintained guidance and noted large engine flying hours were up 65% year-to-date.

Investors will be keen to hear how 2023 is shaping up with tailwinds from a China reopening and increased defence spending. [MG]

Nvidia

Forthcoming results could be a major test for the recent share price rally

From chips shortage to a supply glut, things have changed rapidly in the semiconductors space in recent months and investors will be watching how this may have impacted Nvidia’s (NVDA: NASDAQ) earnings when it reports on 22 February.

Consensus already anticipates a 21% year-on-year decline for sales to $6 billion and 38% drop in earnings per share at $0.81 respectively. Yet its share price has surged 50% so far this year as investors have been flocking to    stocks that were heavily sold off in 2022. This share price momentum could run out of steam if Nvidia delivers a downbeat outlook statement. [SF]

Home Depot and Walmart

The two US companies should provide insight into consumer confidence

Next week will hopefully give us an idea of how positive middle America is feeling about life as we get reports from two of the country’s most iconic retailers.

DIY chain Home Depot (HD:NYSE) posts its latest results on 21 February, with analysts forecasting earnings per share of $3.27 for the fourth quarter against $3.21 previously and $16.63 for the full year.

However, the firm’s 93-year-old, billionaire founder Bernie Marcus has hardly endeared himself to younger customers, claiming ‘nobody works any more’ and ‘woke people have taken over the world’.

The same day, the world’s biggest retailer Walmart (WMT:NYSE) is expected to post earnings per share of $1.51 for the fourth quarter and $6.09 for the year, a drop of 5% on the previous year. [IC]

UK UPDATES OVER THE NEXT 7 DAYS

FULL-YEAR RESULTS

17 February: Allianz Technology Trust, NatWest, Segro

21 February: HSBC, InterContinental Hotels, Standard Chartered

22 February: Conduit, Hochschild Mining, Lloyds, Primary Health Properties, Rio Tinto, Synectics, The Renewables Infrastructure Group

23 February: Anglo American, BAE Systems, Drax, Driver Group, Greencoat UK Wind, Hellenic Telecom Industries, Hikma Pharmaceuticals, Howden Joinery, Morgan Sindall, Serco, Spectris

HALF-YEAR RESULTS

20 February: Tristel, Wilmington

21 February: Blancco Technology, Finsbury Food, Springfield Properties

22 February: Avingtrans, Transense Technologies

23 February: Genus, Hays, Made Tech

TRADING UPDATES

21 February: Safestore

US UPDATES OVER THE NEXT 7 DAYS

QUARTERLY RESULTS

17 February: Deere & Company, Daimler, CenterPoint Energy

20 February: Nordson

21 February: Home Depot, Molson Coors Brewing, Palo Alto Networks, Walmart

22 February: NVIDIA, Ebay, Etsy, Bath & Body Works

23 February: American Tower, Cheniere Energy Partners, EOG Resources, Keurig Dr Pepper, MercadoLibre, Moderna, NetEase, Warner Bros Discovery

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