The Week Ahead: easyJet, Vodafone

Monday 18 July

Trading Statements

Microgen, Mirada, Rio Tinto, British Land

AGMs/EGMs

All Asia Asset Capital, Mereo Biopharma, Summit Therapeutics, DekelOil

Tuesday 19 July

Trading Statements

Alliance Pharma, Synectics, ASA Resource Group, Ideagen, BHP Billiton, Evraz, Royal Mail

AGMs/EGMs

Blue Prism Group, FirstGroup, HICL Infrastructure Co., Wizz Air

Wednesday 20 July

Trading Statements

Clinigen, Anglo American, Severn Trent, Fresnillo, TalkTalk Telecom, Wizz Air, Electrocomponents, Kcell Jsc, Revolution Bars

AGMs/EGMs

B.P. Marsh, Ashmore Global Opportunities, Lansdowne Oil & Gas, Johnson Matthey, Severn Trent, Electrocomponents, Renold,  Highbridge Multi-strategy Fund

Thursday 21 July

No-frills airline easyJet releases its third-quarter results on Thursday and, judging by last month's profits warning, they're unlikely to be pretty. We already know pre-tax profit shrunk by £28 million and revenue per seat fell 8.6% in the three months; Thursday's numbers should give a fuller picture to what many will hope is not a horror story.

The Brexit fallout and recent terror attacks have hit airlines hard, but easyJet is suffering more than others. Around 40% of its flights travel between the other 27 other EU countries without ever touching British soil. There's a risk the carrier could lose the rights to operate those flights if Britain's EU divorce turns sour.

Said to be worth around £6 a share, losing its intra-EU business will be devastating. At least Macquarie Capital analyst Douglas McNeill doubts this is likely to happen.

Still, easyJet shares fell by 35% to a three-year low in the days following the referendum and, unlike other FTSE 100 stocks, they've struggled to regain ground since. It seems investors want concrete proof that the final deal on Brexit won't kneecap EasyJet. Without it, few are buying the risk.

And McNeill takes Brexit's threat to the firm seriously, slashing 2017 earnings expectations by 30% -three times the profits miss predicted by the airline itself. It's also taken a red pen to earnings forecasts for 2016, 2017 and 2018, cutting them by 18%, 30% and 27% respectively. This has triggered a massive target price downgrade from £22 to just £12.75, although there's still modest upside from current levels.

"The share price has fallen by nearly a third from a level we already thought was on the low side. It prices in more profit warnings and a worst-case outcome on single market access post-Brexit," writes McNeill.

"It is undershooting intrinsic value by a long way and represents a clear opportunity for the bargain-hunter."

Trading Statements

WH Ireland, Unilever, Nichols, SABMiller, SSE, Tate & Lyle, Babcock International, Daily Mail & General Trust, easyJet, Britvic, Severstal

AGMs/EGMs

Paragon Entertainment, Royal Mail, Kibo Mining, Land Securities, De La Rue

Friday 22 July

FTSE 100 mobile leviathan Vodafone's first-quarter results, out on Friday, are widely expected to be a knock-out.

After dipping below 200p in February and suffering only a very brief Brexit hiccup, the shares gained ground to catch up with telecoms rivals and now sit at 227p.

JP Morgan analyst Akhil Dattani rates Vodafone's return to growth and expects more of it in its latest numbers, forecasting a 1.9% increase in organic service revenues quarter-on-quarter, to be followed by 2.0% and 2.4% growth in the second and third quarters respectively.

"This momentum should steadily raise confidence in the sustainability of the recent return to growth, and underpins our belief that this growth profile is now top-tier amongst the incumbent Telco universe," writes Dattani in a research note.

Vodafone CEO Jeroen Hoencamp sees "limited impact" from Brexit, too, given only 4% of its free cash flow comes from the UK.

The broker has a price target of 300p, implying 31% upside from the current share price.

Trading Statements

Capital & Counties Properties, Big Yellow Group

AGMs/EGMs

KCOM Group

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.