Anglo American, Burberry, TSMC and Netflix

The quarterly reporting season is about to start again and major companies from around the world are providing insights into the developments in certain sectors.

Investors can look to news from the mining sector, with our focus remaining on Anglo American, while Burberry provides an indicator for the luxury goods sector after a slowdown in demand from China hit sales.

In Asia, semiconductor giant TSMC is expected to beat expectations amid artificial intelligence hype and continued demand for chips.

Across the pond, Netflix will try to convince investors that the company is as popular as ever and that its revenue and profits will continue to rise.

What you should pay attention to:

Anglo American (AAL.L) – Reports trading update on Thursday, July 18

Anglo-American was the target of a takeover bid from rival BHP (BHP.L) and has announced its own restructuring plans following the failed mining mega-merger, so investors will surely be closely scrutinising the company’s half-year results.

Anglo intends to sell or spin off its coal, platinum, nickel and diamond mining operations, leaving a streamlined business comprising the company’s valuable copper mines (BHP’s main target), its high-grade iron ore business and the Woodsmith fertiliser project in North Yorkshire.

Anglo is heavily invested in copper and the price of the industrial metal is just starting to fall again after a sharp rise.

Regarding the actual earnings report, AJ Bell recommends that investors pay attention to information about production costs.

“Details of the balance sheet, cash flow and profit and loss account will be announced with the actual first half figures, but watch for any changes to production forecasts and targets, as well as comments on production costs and capital investment, as all of these factors will have a direct impact on profit and cash flow,” wrote Russ Mould, investment director, Danni Hewson, head of financial analysis, and Dan Coatsworth, investment analyst, all of AJ Bell.

Read more: How the prices in the FTSE All-Share Index change

“In the unlikely event that [CEO Duncan] Wanblad discusses annual earnings or dividends ahead of the release of half-year results next week. The current consensus forecast is for earnings before interest, taxes, depreciation and amortization (EBITDA) to be broadly unchanged at $9.7 billion in 2024, while the dividend is expected to be cut from $0.96 to $0.83 per share.”

The share price is still around 20 percent higher than before the BHP stake was made public on April 25.

Burberry (BRBY.L) – reports trading update on Friday, July 19

Trench coat maker Burberry is not expected to impress investors next week. In the company’s fiscal first quarter, comparable-store retail sales are estimated to fall 16 percent, a slump that is magnified by 18 percent growth in the same period last year.

The story continues

UBS expects the focus to be on Chinese sales “as well as any signs of stabilization/improvement in other consumer groups (ie Americans and Europeans).”

JP Morgan has warned that the luxury sector’s “reacceleration” could be slower than expected, creating downside risks for luxury stocks.

“The difficult times for Burberry continue. The company has carried out a series of major layoffs to cut costs. Sales fell 4% in the year to the end of March and demand in the key Chinese market looks set to weaken further,” IG said.

Burberry’s share price lost more than half last year, falling back to 2010 levels.

Compared to the average P/E ratio of 17 over the past five years, Burberry now looks cheap at 11. IG analysts warned that while the dividend yield is a solid 7%, investors should be aware that the payout could be cut if the group’s revenue outlook deteriorates further.

For the year to March 2025, analysts currently expect sales to fall 6% to £2.8 billion.

TSMC (TSM) – Quarterly Update Report on Thursday, July 18

The AI ​​craze has driven Nvidia and other Magnificent 7 stocks to new heights, but without chips, there is no AI. And those are (almost) all made by TSMC in Taiwan.

Taiwan Semiconductor’s major customers, including Nvidia and Apple, have virtually no choice when it comes to manufacturing next-generation chips.

TSMC’s expected order for next-generation two-nanometer technology will be a key catalyst in the second half of the year, according to Citi analysts, who expect AI and government investment to push up the company’s 2030 revenue target of 44-60 billion euros, Bloomberg reported.

The Taiwanese silicon giant said in its latest monthly revenue report that net profit for June was NT$207.87 billion (US$6.4 billion), up 32.9% year-on-year.

Read more: How to invest in AI while the rally continues

The figures for May and April were NT$229.62 billion (US$7.04 billion) and NT$236.02 billion (£5.41 billion/US$7.24 billion), respectively, both up from the same period last year. TSMC is expected to grow its revenue by about 21% in fiscal 2024 and 2025.

“Taiwan Semiconductor, along with Nvidia and others, is one of the most straightforward buy-and-hold options in the entire technology space because chips are the lifeblood of the economy and TSM is the semiconductor manufacturer,” said Zachs Research.

“Any short-term decline to some of Taiwan Semiconductor stock’s key shorter or longer-term moving averages could be a clear buy signal for long-term investors,” Zachs analysts added.

Netflix (NFLX) — Published on Thursday, July 18, the results of the second quarter

Netflix is ​​synonymous with streaming services and will show investors how the company is fighting for the top spot and can continue to attract new subscribers despite tough competition.

Netflix expects its revenue in the second quarter of 2024 to rise 16% year-on-year to $9.49 billion (£7.3 billion), but analysts expect Netflix’s second-quarter revenue to be slightly higher at $9.53 billion. In the first quarter of 2024, Netflix’s revenue was $9.37 billion, up 15% year-on-year.

Matthew Dolphin, equity analyst at Morningstar, offers a guide to what investors should focus on. “We’re most interested in details on Netflix’s ad-supported service, particularly how the company is progressing with monetization, as well as an update on the size of its ad-supported user base,” he said.

“More broadly, we will be watching to see whether subscriber growth slows significantly after Netflix overcomes the tailwinds of its crackdown on password sharing, and whether the company will stop regularly disclosing this metric in 2025.

“We will also be interested in international revenue and subscriber growth. This will be a key driver for the company when/if domestic growth slows,” he wrote.

As AJ Bell writes, Netflix no longer provides specific forecasts for quarterly net subscriber additions, although co-CEOs Greg Peters and Ted Sarandos indicated in the first quarter that net additions would be below the 9.3 million seen in the first quarter (the best first quarter since the pandemic and lockdowns in the first quarter of 2020), bringing total subscribers down to just under 270 million, down from 233 million in the first quarter of 2023 and 167 million before the global pandemic.

Matt Britzman, equity analyst at Hargreaves Lansdown, is also paying attention to subscriber numbers: “One thing to watch is the number of new paying subscribers in Q2. Management has already warned that it will be lower quarter-on-quarter due to normal seasonal demand patterns. These have been somewhat skewed in recent years, but if you look at the 2018/19 numbers, net new subscriber numbers were down 34% and 70% in Q1 and Q2 respectively – so don’t be surprised if you see something along those lines.

“Best-in-class content is one of the reasons Netflix has been able to consistently achieve industry-leading churn rates. While it’s expensive, Netflix remains the only company that will increase its spending on content, giving it a competitive advantage over traditional media and its challengers.”

Other companies releasing their reports next week include:

Monday, July 15

Robert Walters (RWA.L)

Orkla (ORK.OL)

Goldman Sachs (GS)

BlackRock (BLK)

Tuesday, July 16

Ocado (OCDO.L)

Intermediate Capital (ICG.L)

B&M European Value Retail (BME.L)

Bloomsbury Publishing (BMY.L)

McBride (MCB.L)

Richemont (CFR.SW)

NCC (NCC.L)

UnitedHealth (UNH)

Bank of America (BAC)

Morgan Stanley (MS)

Omnicom (OMC)

Wednesday, July 17

Renold (RNO.L)

HVIVO (HVO.L)

BHP (BHP.L)

ASML-1 (ASML-1)

Assa Abloy (ASSA-B.ST)

Svenska Handelsbanken (SHB-B.ST)

Johnson & Johnson (JNJ)

CSX (CSX)

US Bancorp (USBC.VI)

Las Vegas Sands (LVS)

Citizens Financial (CZFS)

United Airlines (UAL)

Alcoa (AA)

Bank OZK (OZK)

Thursday, July 18

SSE (SSE.L)

Diploma (DPLM.L)

Dunelm (DNLM.L)

Kier (KIE.L)

QinetiQ (QQ.L)

ABB (ABBNY)

Atlas Copco (ATCO-A.ST)

Volvo (VOLV-A.ST)

EQT-Shares (EQT-Shares)

Publicis (PUB.PA)

Nokia (NOK)

Volvo Car (VOLCAR-B.ST)

SKF (SKF-B.ST)

Abbott Labs (ABL.MU)

Black Stone (BX)

Dr. Horton (DHI)

Tractor Supply (TSCO)

Domino’s Pizza (DPZ)

Interpublic (IPG)

American Airlines (AAL)

Alaska Airlines (ALK)

Friday, July 19

Bridgepoint (BPT.L)

Schindler (SHLRF)

Kone (KNEBV.HE)

Sandvik (SAND.ST)

Saab (SAABBS.XC)

Electrolux (ELUXY)

American Express (AXP)

Schlumberger (SLB)

Halliburton (HAL)

You can find the full Yahoo Finance calendar here Here.

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