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Wolseley (Q3 statement 20 June)
Wolseley reports for the last time before it is renamed Ferguson at the end of July. The outlook in the US is the key driver of positive sentiment for the firm, with a weaker pound helping to burnish performance. The shares were recently upgraded by JPMorgan, which focused on the increasing proportion of earnings from the US, and boosted its target price to £56 from £49, with a 15% upside for earnings.
Wolseley shares steadily rose throughout 2016, but since the beginning of the year the rally has flatlined, despite a spike to £52, the highest level seen since 2007. The zone around £47 has provided strong support since mid-April, so if this holds a push back to £51/£52 cannot be ruled out. A close below £47 risks a move to £46 or even down to £41.40, the May 2016 peak.
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