The Week Ahead: Broker backs NETeller to beat the bears

Bear Raiders have mauled NETeller shares in the run-up to tomorrow's maiden results from the money transfer specialist. The fact that short sellers have targeted the group is no surprise. NETeller listed at 200p a share a year ago and soared to a high of 757p last month, at which point the company was valued at £900m.

Bear Raiders have mauled NETeller shares in the run-up to tomorrow's maiden results from the money transfer specialist. The fact that short sellers have targeted the group is no surprise. NETeller listed at 200p a share a year ago and soared to a high of 757p last month, at which point the company was valued at £900m.

The raiders used every trick in the book to try to push the shares down. First they suggested that it was only a matter of time before the company faced more competition to its specialist "e-wallet", which funnels money from online gamblers to betting and casino sites. Then they spread the rumour that NETeller's recent acquisition in the Far East had hit a snag. Throughout the onslaught the group has refused to comment on speculation and has persistently said that its results will do the talking.

But what should investors expect? For the year just gone, Durlacher forecasts it will deliver a pre-tax profit of $52m (£28m) on sales of $83m. And it expects profits to soar to $84m in 2005. With a price target of 1,200p on NETeller, the broker is basically saying to the market that if you are short of stock you are going to face significant financial pain.

Today: DAT Group has been another Durlacher wonder-stock. Since its float in December the company's value has nearly quadrupled. The mobile phone technology group is forecast to show a loss of £2.2m when it unveils its full-year figures today, but at this stage the alliances the company secures are more important. Late last week gossips suggested that accompanying the figures could be news of a deal with a major global technology player. Should that prove to be the case, DAT shares are likely to continue their meteoric rise.

Given the strength of the oil price, BP's first-quarter trading statement can only be a bullish affair. Indeed, upgrades to earnings forecasts are possible in its wake. The most immediate beneficiaries of the strong price of crude are integrated oil players like BP and should Goldman Sachs' prediction last week prove to be correct - that the oil price will hit $100 per barrel - then those investors with exposure to the sector can expect to do very well. On a BP-specific issue, some in the City are hoping the company gives further details about the flotation of its chemicals business.

Results: Full year - Alexon; DAT Group. Interims - None. Trading statements - BP.

Tomorrow: Despite December's profit warning, the medical devices group Whatman should still be able to deliver a 24 per cent rise in full-year profits to £17m. The setback was caused by a poor performance from its MedTech division but Investec Securities believes there is a good chance sales at the unit have recovered since then, given the strong growth presently enjoyed by the industry as a whole. As for 2005, the broker expects Whatman to achieve earnings growth of 29 per cent. Investec is also keen to hear the company's progress on finding a new chief executive.

Results: Full year - NETeller; Datacash; Havelock Europa; Sopheon; Whatman. Interims - None.

Wednesday: Intermediate Capital Group helps fund leveraged buyouts and, given the present boom in this particular segment of the financial services industry, the group's full-year results should impress. Cazenove forecasts ICG to unveil a 30 per cent jump in annual profits to £83m. On the dividend front, at the half-year stage ICG boasted of a 12 per cent rise in its payout to shareholders and the broker expects a similar rise at the full-year stage. This will take ICG's total dividend for 2004 to about 38.8p per share.

Dealers reported heavy shorting of Signet shares last week and certainly many market players expect the jewellery retailer to unveil disappointing fourth-quarter results. In February, Signet revealed that like-for-like sales at its H Samuel and Ernest Jones chains had been slowing. Given recent updates from fellow retailers, things are unlikely to have improved since. If anything, trading is likely to have deteriorated further. For the full year, Signet should announce a slight improvement on the £211m profit it registered last time.

Results: Full year - James Beattie; Cenes Pharmaceutical; Corin; Intermediate Capital; MSB International; Signet. Interims - Charteris. Trading statements - Peacock; Boots.

Thursday: Results: Full year - None. Interims - Air Partner.

Friday: Results: None expected.