The Week Ahead: ARM's prospects linked to sales growth at Apple

Shares in the chip-maker ARM Holdings have been much in demand in recent weeks after rumours of a potential takeover resurfaced. That chat, along with a good contract win with Samsung, almost sent the Cambridge-based company's shares to an eight-year high in September.

ARM makes chips that go in smartphones and tablets, perhaps most significantly in Apple's iPhone and iPad. In fact, Apple is the company normally pencilled in as ARM's most likely buyer. The appetite for smartphones appears undiminished, and the iPad has been hugely successful, prompting the launch of a raft of rival tablet devices. Yet last week ARM's shares were adversely affected as Apple indicated that, despite its popularity, the iPad had not hit sales targets.

ARM's full-year earnings per share is expected to be twice last year's figure and investors will be keen to learn the forecasts for its crucial markets in 2011 when it announces its third-quarter numbers tomorrow.



Today

The publisher Pearson will issue a third-quarter trading update. Mark Braley, an analyst at Deutsche Bank, said the group was the only one of its European peers "to actually give useful information" in its Q3s.

The third quarter is the key selling season in the school-books market, Mr Braley said, but this year's trends have already been well flagged. Instead, he will be looking for guidance on Pearson's "visibility" in next year's education market, given the pressure from the state funding crisis, and any sales opportunities stemming from federal stimulus measures in the US.

Other unknowns include whether Pearson will make use of its strong balance sheet, and whether there are succession plans for its chief executive, Marjorie Scardino.

Results/Updates: Pearson.



Tomorrow

Results/Updates: Aquarius Platinum; ARM Holdings; Braemar Shipping Services; Jazztel; Mitchells & Butlers; Subsea 7.



Wednesday

Virgin Media issues its third-quarter numbers this week and, much like its rival, British Sky Broadcasting, has benefited from the increase in high-definition television channels.

Investors will be hoping Virgin can follow the record growth it posted in the second quarter, when sales rose by 7 per cent. The market will also be looking for more news about the disposal of Virgin's 50 per cent stake in UKTV, which owns channels including Dave and Gold, as well as the take-up of its 50Mb broadband service.

Also reporting third-quarter numbers on Wednesday is British American Tobacco. Julian Hardwick, an analyst at Royal Bank of Scotland, expects a more moderate decline in organic volumes than in previous quarters. He expects that overall volumes will be supported by hoarding in Japan before a significant excise-tax increase. This is significant for BAT because it has 10.4 per cent of the Japanese cigarette market. Mr Hardwick believes the shares look fully valued but that if it delivers strong organic growth they could push higher in the short term.

Results/Updates: British American Tobacco; CSR; First Derivatives; Willis Group Holdings; Virgin Media.



Thursday

Analysts at Deutsche Bank expect that AstraZeneca will struggle to match the performance of its past two quarters, when it beat consensus estimates, as it issues its latest figures. Mark Clark, of the German broker, said the third quarter was comparatively very tough and the pharmaceuticals company's earnings per share should show a marked decline.

"We do not expect AstraZeneca to raise the upper end of its full-year core earnings-per-share guidance range," he said. Some of the group's biggest drug brands face pressure from generic competition.

Mr Clark also noted that Astra also enjoyed a $152m earnings "windfall" from its H1N1 bird flu vaccine in the third quarter of 2009. There is little news expected for the rest of the year beyond the US Food and Drug Administration's long-awaited decision on Astra's experimental blood thinner, Brilinta, in December.

The specialist chemicals group Croda also has numbers out this week. Martin Evans, at JPMorgan Cazenove, believes it has found "a counter-cyclical niche through new product innovation". He reckons Croda should report continued trading strength, and he forecasts third-quarter sales of £252m, up from £213m a year ago. Brokers at Liberum have recently touted Croda as a takeover target.

Results/Updates: Ashmore Group; AstraZeneca; Croda International; Go Ahead Group; Mouchel Group; Premier Foods; Rugby Estates; William Hill.



Friday

British Airways is set to report its second-quarter results. Deutsche Bank forecasts operating profits of £282m compared with an operating loss of £72m in the first quarter, when the UK's flag-carrier airline was hit by the effects of Iceland's volcanic ash cloud and strike action by BA cabin crew.

Results/Updates: British Airways; F&C Asset Management; Sabien Technology Group; Shire Pharmaceuticals; WPP Group.

Today: British Bankers' Association mortgage approvals for September; Confederation of British Industry conference; speech by Mervyn King.



Tomorrow: UK Q3 gross domestic product.

Wednesday: None



Thursday: Confederation of British Industry distributive trades survey.



Friday: UK mortgage approvals for September.

News
i100'Geography can be tough'
News
newsVideo targets undecided voters
Arts and Entertainment
Singer Pixie Lott will take part in Strictly Come Dancing 2014, the BBC has confirmed
tv
Life and Style
Cooked up: reducing dietary animal fat might not be as healthy as government advice has led millions of people to believe
healthA look at how governments started advising incorrectly on diets
PROMOTED VIDEO
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

DevOps Engineer - Linux, Shell, Bash, Solaris, UNIX, Salt-Stack

Negotiable: Harrington Starr: A fast growing Financial Services organisation b...

Trade Desk FIX Analyst - (FIX, SQL, Equities, Support)

£50000 - £60000 per annum + excellent benefits: Harrington Starr: An award-win...

DevOps Engineer - (Linux, Shell, Bash)

Negotiable: Harrington Starr: DevOps Engineer - (Linux, Shell, Bash)DevOps Eng...

Calypso Developer

£500 - £700 per day: Harrington Starr: Calypso Developer Calypso, J2SE, XML, ...

Day In a Page

Kate Bush, Hammersmith Apollo music review: A preamble, then a coup de théâtre - and suddenly the long wait felt worth it

Kate Bush shows a voice untroubled by time

A preamble, then a coup de théâtre - and suddenly the long wait felt worth it
Robot sheepdog technology could be used to save people from burning buildings

The science of herding is cracked

Mathematical model would allow robots to be programmed to control crowds and save people from burning buildings
Tyrant: Is the world ready for a Middle Eastern 'Dallas'?

This tyrant doesn’t rule

It’s billed as a Middle Eastern ‘Dallas’, so why does Fox’s new drama have a white British star?
Rachael Lander interview: From strung out to playing strings

From strung out to playing strings

Award-winning cellist Rachael Lander’s career was almost destroyed by the alcohol she drank to fight stage fright. Now she’s playing with Elbow and Ellie Goulding
The science of saturated fat: A big fat surprise about nutrition?

A big fat surprise about nutrition?

The science linking saturated fats to heart disease and other health issues has never been sound. Nina Teicholz looks at how governments started advising incorrectly on diets
Emmys 2014 review: Can they genuinely compete with the Oscars

Can they genuinely compete with the Oscars?

The recent Emmy Awards are certainly glamorous, but they can't beat their movie cousins
On the road to nowhere: A Routemaster trip to remember

On the road to nowhere

A Routemaster trip to remember
Hotel India: Mumbai's Taj Mahal Palace leaves its darker days behind

Hotel India

Mumbai's Taj Mahal Palace leaves its darker days behind
10 best pencil cases

Back to school: 10 best pencil cases

Whether it’s their first day at school, uni or a new project, treat the student in your life to some smart stationery
Arsenal vs Besiktas Champions League qualifier: Gunners know battle with Turks is a season-defining fixture

Arsenal know battle with Besiktas is a season-defining fixture

Arsene Wenger admits his below-strength side will have to improve on last week’s show to pass tough test
Pete Jenson: Athletic Bilbao’s locals-only transfer policy shows success does not need to be bought

Pete Jenson: A Different League

Athletic Bilbao’s locals-only transfer policy shows success does not need to be bought
This guitar riff has been voted greatest of all time

The Greatest Guitar Riff of all time

Whole Lotta Votes from Radio 2 listeners
Britain’s superstar ballerina

Britain’s superstar ballerina

Alicia Markova danced... every night of the week and twice on Saturdays
Berlin's Furrie invasion

Berlin's Furrie invasion

2000 fans attended Eurofeurence
‘It was a tidal wave of terror’

‘It was a tidal wave of terror’

Driven to the edge by postpartum psychosis