Our regular look at the FTSE 350 and a selection of other companies reporting from 22 – 26 August 2022
- Nvidia profits under pressure as revenue falls $1.4bn below expectations
- Record recruitment fees for Hays could see shareholders benefit
- CRH will share guidance on the outlook on construction
Nvidia, Q2 Results, Wednesday 24 August
Charlie Williams, Equity Research Assistant, “Nvidia’s already prepped markets that second quarter revenue will fall $1.4bn short of the $8.1bn guided, as gaming revenue weakened. Given record gaming revenues last quarter, the substantial miss in guidance this quarter has put doubt in investors’ minds.
Gross margins are now expected to be around 46.1%, down from previous expectations of 67.5%. As management tried to balance short term profitability with long-term investments, controlling operating costs are key. We’ll be watching out for commentary on how costs are expected to trend into the next quarter and beyond.
It’s not all bad news, Nvidia expects to continue with share buybacks as strong cash generation’s looks set to continue. However, with competitors reporting falls in gaming and PC demand, any indication on consumer demand going forward will be welcomed.”
Hays, Full Year Results, Thursday 25 August
Charlie Williams, Equity Research Assistant, “Recruitment firms like Hays have usually performed well when the economy was growing and lagged during times of economic uncertainty. Despite recession fears growing, Hays fourth quarter trading showed record quarterly growth in net fees, up 24%, which is impressive considering the challenging environment. It’ll be interesting to hear how management sees wider conditions impacting recruitment going forward.
Costs will be in the spotlight too, as Hays continues to increase headcount. Management have stated productivity remains strong, but it remains to be seen what impact these costs have had on operating margins, if any.
Investors will also be keen to see how this growth translates to shareholder distributions. Having increased net cash to £295m from £237m at the start of the year, the board remains committed to returning cash to shareholders through dividends and share buybacks.”
CRH, Full Year Results, Thursday 25 August
Charlie Williams, Equity Research Assistant, “Global building materials group CRH had a positive start to the year and the company expects sales, cash profits and margins for the first half of 2022 to be ahead of the prior year. Half year results should shed light on whether wider conditions have hurt demand and it’ll be interesting to see if those targets remain intact.
Acquisitions fuel a big part of CRH’s growth strategy, and it was reported in April the company had spent roughly $0.6bn on 11 acquisitions year to date. After successfully integrating previous acquisitions, it’ll be interesting to see whether there’s scope for further business over the second half.
The group’s expected to confirm another $0.3bn of share buybacks, totalling $0.6bn for the year so far. The divestment of the Building Envelope business worth $3.8bn is expected to close in this quarter and it should be revealed next week what management plans to do with the cash.”
FTSE 100, FTSE 250 and selected other companies scheduled to report
| 22-Aug | |
| No FTSE 350 reporters | |
| 23-Aug | |
| John Wood Group | Half Year Results |
| 24-Aug | |
| Nvidia | Q2 Results |
| 25-Aug | |
| Harbour Energy | Half Year Results |
| Hays | Full Year Results |
| Grafton Group | Half Year Results |
| CRH | Half Year Results |
| 26-Aug | |
| No FTSE 350 reporters | |
This article is 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.
