Defence firm’s acquisitions are under spotlight for investors

Today

FTSE 250 defence contractor Ultra Electronics’s results kick off a sparser corporate calendar this week with the firm’s acquisitions activity the focus for investors.

Last month the company reached a $234.8m (£180m) deal to acquire joint venture partner Sparton, using a £137m share placing to fund the purchase.

The deal for the warfare specialist is expected to be tied up by January and investors will be looking for more clues on the company’s ambitions in this area, according to Benjamin Fidler, the Deutsche Bank analyst.

Tomorrow

With shares sitting near a two-year low, gambling giant Paddy Power Betfair will be looking to replicate rival William Hill’s postresults boost last week.

The FTSE 100 company could face some difficulty gaining momentum, however, with punterfriendly sports and a tough comparison given the absence of an international football tournament this year expected to weigh on earnings.

With intense competition in the sector, upgrades in its first half results are unlikely, according to Patrick Coffey, a Barclays analyst. Despite a tougher regulatory environment on the horizon in the UK and Australia, Mr Coffey believes that shareholders will benefit in the long-term as the company is going through a “transitional period”.

Wednesday

Investors will be keeping a watchful eye on security specialist G4S’S first half results to see whether its recovery remains on track.

Solid growth is expected to be maintained in its developed markets division and it appears the world’s largest security firm is starting to reap the rewards from cutting its debt pile and ditching the company’s non-core assets.

With shares rising to their best ever level last month, hopes are high that the business has left behind its gaffe-ladened history and debt strains.

“G4S’S balance sheet is no longer a concern given strong growth trends and cash generation, as well as disposals,” Deutsche Bank told clients ahead of the results.

Thursday

Office space developer Derwent London will report to the market with analysts split over the outlook for the office space rental sector.

Some analysts have warned that the UK’S property firms are at risk from being overly reliant on foreign capital with the London market and Derwent’s portfolio considered most exposed to sector turbulence in the UK.

Exane BNP Paribas, however, recently praised the developer’s portfolio of offices on the fringes of central London, its shares popping on the bullish prediction.

The broker theorised that Derwent is well-placed to withstand any Brexit headwinds as companies looking to cut costs will plump for its cheaper spaces on the edges of the City and the West End.

Friday

Few fireworks are expected in Old Mutual’s earnings with investors likely to continue to focus on any update regarding the company’s plan to separate its four main divisions including its UK wealth management business.

The investment giant made a big stride towards its goal in March, announcing the sale of its Italian arm for £210m and also cutting its stake in OM Asset Management in half.

The company is aiming to have completed the four-way parting by the end of next year with its majority stake in troubled South African lender Nedbank Group the next expected to go.