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Why Mothercare, WH Smith, and PZ Cussons Should Beat the FTSE 100 Today

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By Alan Oscroft, The Motley Fool

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LONDON — The FTSE 100 continues its slow recovery, having put on another 0.21% to reach 6,401 points by 8 a.m. EDT. The blue-chip index has been boosted by a 3% rise in the Marks & Spencer price after the retail chain reported its best-ever Easter Week for food. But on the downside, a number of our largest miners have begun to slip after a good couple of days.

But what of companies in the news? Here are three from the various indexes that are looking good today.

Mothercare
Mothercare shares have leapt 7.2% to 313 pence after the firm told us its U.K. store closure plan is ahead of schedule and sales have stabilized in its fourth quarter. While like-for-like sales are flat, the firm’s Direct Internet business saw an 18.2% rise in sales, prompting chief executive Simon Calver to say, “We can look ahead to the new year with confidence.”

With international sales rising by 15.5% during Q4 and the firm’s focus firmly on cash gross margin, Mothercare was able to confirm that underlying pre-tax profit for the full year is in line with market expectations.

WH Smith
Another High Street name is doing well today: Shares in WH Smith have climbed 3.8% to 773.5 pence on the release of interim figures. Total pre-tax profit for the group is up 5% for the six months to Feb. 28 to 69 million pounds. That led to bottom line earnings-per-share growth of 11% to 44.2 pence, enabling the company to lift its interim dividend by 13% to 9.4 pence per share.

The strong performance came from Smith’s two divisions: Travel saw a 7% rise in trading profit to 29 million pounds, while the equivalent High Street figure gained 2% to 48 million pounds.

PZ Cuzzons
Maker of toiletries and other household products PZ Cussons saw its shares rise 1.8% to 394 pence after the firm released an interim management statement. For the quarter to April 10, performance, including cash generation, was in line with management expectations.

Business is tough in some of the company’s markets, with its largest, Nigeria, facing social and political unrest. But the firm still believes the rest of the year should go according to expectations, and it should return to profitable growth.

Finally, if you’re looking for investments that should take you all the way to a comfortable retirement, I recommend the Fool’s special new report detailing five blue-chip shares. They’ll be familiar names to many, and they’ve already provided investors with decades of profits. But the report will only be available for a limited period, so click here to get your hands on these great ideas — they could set you on the road to long-term riches.

The article Why Mothercare, WH Smith, and PZ Cussons Should Beat the FTSE 100 Today originally appeared on Fool.com.


Alan

From: http://www.dailyfinance.com/2013/04/11/why-mothercare-wh-smith-and-pz-cussons-should-beat/

Business, Finance, Occupation & Industry

Dow May Open Higher, but HP Could Plunge

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open up by 0.11% this morning, while the S&P 500 may open a single point higher. Investors are cautious ahead of today’s jobs figures, but yesterday’s gains helped drive the CNN Fear & Greed Index back into “greed” territory: The sentiment indicator closed at 62 yesterday, up from 53 the previous day.

In Europe, markets edged slightly higher this morning, as the absence of new economic data meant that investors focused on corporate news and renewed hopes for Chinese growth. At 7 a.m. EDT, the FTSE 100 was up 0.32%, Germany’s DAX was up 0.51% and the French CAC 40 was 0.49% higher.

Thursday is jobless-claims day, and last week’s disappointing jobs figures mean investors will be focusing more closely than usual on this key metric when it is published at 8:30 a.m. EDT. Consensus forecasts indicate that 360,000 new jobless claims may have been made last week, down slightly from 385,000 in the previous week. Also due at 8:30 a.m. EDT, March’s import price index is expected to show a 0.5% fall in import prices following a 1.1% rise in February.

Companies due to update the market this morning include Costco Wholesale, which said this morning that like-for-like sales for the five weeks to April 7 rose by 4%, missing a Reuters forecast of 5.2%. Costco’s total sales rose by 7% over the same period to $9.67 billion from $9.07 billion last year. Before the opening bell, quarterly results are expected from Commerce Bancshares, iGate Corporation, Pier 1 Imports, and Rite Aid, among others.

Stocks that could be actively traded this morning include Intel, Hewlett-Packard, and Microsoft, which all fell heavily in after-hours trading last night following news that global PC sales dropped by 14% during the last quarter. HP shares were 4.1% lower in premarket trading, while Microsoft was down by 3.4% and Intel was 1.9% lower. Housewares retailer Bed Bath & Beyond may also be actively traded after it posted earnings growth of 6.5% in its fiscal fourth quarter but said that earnings for the current quarter would be between $0.88 and $0.94 per share, below consensus forecasts of $0.95 per share. Bed Bath & Beyond shares closed 1.6% higher yesterday and were 1.5% higher in premarket trading this morning.

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks to Retire On.” Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

The article Dow May Open Higher, but HP Could Plunge

From: http://www.dailyfinance.com/2013/04/11/dow-may-open-higher-but-hp-could-plunge/

Business, Finance, Occupation & Industry

Are ARM Holdings, Hargreaves Lansdown, and ASOS Titans of Tomorrow?

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By David O’Hara, The Motley Fool

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LONDON — Micro-chip designer ARM Holdings  has long been a stock market darling. The huge rating that it traded on 10 years ago has been fully justified by its recent profitability.

Will buyers today be rewarded in the long term?

ARM has probably been the U.K.’s biggest beneficiary of the smartphone boom. In the last five years, its shares are up almost ninefold. In that time, dividends per share have more than doubled.

Its booming profits will be sure to attract competitors to its market. My concern is that, in the long term, shareholder returns could suffer as a consequence.

ARM currently trades on a 2013 price-to-earnings (P/E) ratio of 46.3 times expectations. The shares would fall hard from here if growth were to slow at any point in the next few years.

Hargreaves Lansdown
Investment shop-window Hargreaves Lansdown  dominates the U.K. market. The company continues to exploit its first-mover advantage, yielding impressive returns for shareholders.

Hargreaves Lansdown has long been traded on a high P/E. That hasn’t stopped the shares from making big returns. In the last five years, investors have seen their money increase almost fourfold. Dividends have risen at an even faster pace, reaching 15.8 pence per share in 2012 vs. 3 pence for 2007.

Hargreaves Lansdown‘s current P/E ratio is around twice that of the average FTSE 100 company. With earnings per share (EPS) growth of 16.7% expected in 2014, that now looks a little rich. There are also signs that competition is heating up since the launch of Charles Stanley’s “Direct” service at the beginning of the year.

ASOS
The investment case for ASOS  is simple: The company is blazing its way to becoming the world’s leading online clothing retailer.

Just look at the most recent December trading statement. U.K. sales up 34%. U.S. sales up 53%. EU sales up 65%. ASOS managed to increase sales 37% in the quarter ending in February. By comparison, FTSE 100 peer NEXT reported a 3.1% sales increase with its most recent results.

ASOS trades on a P/E of 65.8 times consensus 2013 forecasts, vs. 13.2 times for NEXT. Despite that huge difference, NEXT still has a market cap more than double that of ASOS.

Not only does ASOS need to deliver, it also needs the rest of the industry to continue trailing it to justify today’s price. That’s a lot to assume.

Although the growth that these companies have delivered in recent years is impressive, analysts here at The Motley Fool believe that they have found an even better growth share available in the market today. Like the three above, this company is a dominant player in its markets. Our team believes that 2013 could be the year that their pick delivers big returns. To find out which share they have identified and why they expect it to outperform, get the report “The Motley Fool’s Top Growth Share for 2013.” Even better, their report is completely free. Just click here to get your copy today.

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Source: FULL ARTICLE at DailyFinance

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Halfords Group May Still Yield 7%

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By Sam Robson, The Motley Fool

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LONDON — Shares of Halfords Group  were up 4.40 pence, or 1.4%, at the time of writing this morning following the announcement of its pre-close statement for the 52-week period to March 29, 2013.

The U.K.’s leading retailer of automotive and leisure products and services’ total revenue rose 1.7% over the last 11-week period, with its autocentres division continuing its growth as it put in a 7.8% increase, while Retail operations fared well with a 0.5% lift against the same period last year.

Like-for-like (LFL) revenue for the 11-week period saw autocentres increase 0.8%, with retail up 0.3% — helped only by a 10.4% uplift in its car maintenance operations, as cycling fell 8.8%, travel solutions was down 5.5%, and car enhancement dropped by 4%.

Over the 52-week period, Halfords saw a combined increase of 1% in total revenue, with autocentres’ 13.5% lift more than offsetting retail’s 0.9% drop-off. It was a similar story for LFL revenue over the period, as autocentres soared 7% but retail was down 0.7% (car maintenance +5.1%, travel solutions -6.8%, car enhancement -4.2%, and cycling -0.6%), which led to a marginal 0.3% increase for the company overall.

As seen with many companies releasing results recently, Halfords was also affected by the cold snap we’ve had in the U.K., which contributed to the decline in outdoor-focused divisions — cycling, travel solutions — but benefited car maintenance, which benefited from the company’s strategic wefit focus.

Chief executive Matt Davies commented:

This was a robust performance demonstrating how the balance of our business can offset some variations in the weather… We are focused on significantly improving the service we offer customers and this emphasis will be central to our future investments. I look forward to outlining our plans to secure sustainable revenue growth through our three-pillared strategy at our preliminary results on 23 May.

Management confirmed that pre-tax profit is in line with prior assumptions of around 68 million pounds to 72 million pounds. Halfords remains in a good position financially, then, and well regarded by investors interested in high-yielding companies, offering a consensus yield of around 7%.

If you are seeking other high-dividend possibilities, this exclusive free report could assist your investment decisions. The newly updated report reveals the favorite income stocks held by Neil Woodford — the City fund manager who has thrashed the FTSE 100 by favoring dividend-paying blue chips similar to Halfords.

To receive all these Neil Woodford large-cap ideas today — and to learn the investing logic behind them — just click here.

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The article Halfords Group May Still Yield 7% originally appeared on Fool.com.


Sam Robson does not own shares of Halfords Group. The Motley Fool recommends and owns shares of Halfords Group. The Motley Fool owns shares of Halfords Group. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights

Source: FULL ARTICLE at DailyFinance

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Should You Buy Reckitt Benckiser Today?

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By Royston Wild, The Motley Fool

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LONDON — I believe that shares in Reckitt Benckiser  are vastly overpriced and are overdue for a weighty correction. The stock has risen 19% since the turn of the year, and currently trades at a 35% premium to Canaccord Genuity‘s 3,425 pence target price.

The firm is a giant in the household cleaning product and non-prescription health-care space and whose global brands include Dettol, Clearasil, Nurofen, and Durex, among others. But in my opinion, its loss of exclusivity on its Suboxone drug — which is used to combat narcotics addiction — could harm revenues moving forward and sour investor appetite for the company.

Rivals gear up for assault
The U.S. Food and Drug Administration (FDA) halted Reckitt Benckiser‘s patent on the anti-addiction product, a move that will herald the entry of cheaper, generic rivals to the Suboxone brand and harm sales over the medium to long term. Suboxone tablet sales in the U.S. represented around 5% of the firm’s total revenues last year, while film made up closer to 10% of group turnover.

Indeed, BioDelivery Sciences International announced last month that it plans to file an NDA with the FDA for its Bunavail film by July, which is considered a massive threat to Suboxone moving forward. It reckons that the new film could grab between 25% and 35% of the branded market, and plans to launch the product next year.

Earnings pressure set to materialize
Broker Liberum Capital expects earnings per share (EPS) to nudge 1% lower in 2013 to 262 pence, before the effect of falling Suboxone revenues drive EPS 4% lower to 252 pence. The company currently trades on a price-to-earnings (P/E) ratio of 17.7 and 18.5 for this year and next, trading at a premium to a forward earnings multiple of 14.5 for the wider household goods and home construction sector.

Reckitt Benckiser has steadily built the dividend in recent years — 2012’s 134 pence shareholder payout was up 7% from the previous year — but yields are expected to remain around the 3.3% FTSE 100 average over the medium term. A figure of 3.1% and 3.3% are expected by Liberum’s analysts in 2013 and 2014, respectively.

These prospective payments provide coverage just below the safety watermark of two times for these years, although I believe that the effect of falling earnings could cast doubt on the progress of its dividend policy moving forward.

The prescription for plump returns
Although Reckitt Benckiser presents too much risk in my opinion, check out this newly updated special report that highlights a host of other FTSE winners identified by ace fund manager Neil Woodford.

Woodford — head of U.K. Equities at Invesco Perpetual — has more than 30 years’ experience in the industry, and has identified two other fantastic pharmaceutical specialists in the report set to deliver spectacular investor returns.

The report, compiled by The Motley Fool’s crack team of analysts, is totally free and comes with no further obligation. Click here now to download your copy.

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The article Should You Buy

Source: FULL ARTICLE at DailyFinance

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Should You Buy Carnival Today?

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By Royston Wild, The Motley Fool

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LONDON — Shares of cruise ship operator Carnival  have endured a torrid time in recent weeks, slipping 15% from mid-February’s near-two-year high of 2,628 pence to current levels. The company has continued to endure tough press headlines following the Costa Concordia disaster in Jan. 2012, with an engine room fire and subsequent marooning of passengers on its Carnival Triumph ship in February once again denting investor interest in the company.

However, I view recent weakness as an excellent buying opportunity. Indeed, Liberum Capital has placed a 3,000 pence price target on the stock, illustrating the stock‘s excellent upside potential.

Carnival sails back into profit
Carnival announced in last month’s first-quarter update that it swung into a net profit of $37 million from a net loss of $139 million during the corresponding period in 2012. However, the results were overshadowed by news of further mechanical failures at two of its other liners, raising fresh fears over hefty repair bills and effect on customer demand.

The firm advised that, although cumulative advance bookings for this year are behind those of the same point in 2012, bookings have picked up in recent weeks, helped by attractive price promotions. And over the long term, I expect Carnival to successfully negotiate its current travails and boost passenger numbers — Investec has penciled in a compound annual capacity growth rate of 3.7% through to 2016.

In particular, Carnival looks set to make further headway into promising emerging markets, especially in Southeast Asia, and the company announced yesterday that its Sapphire Princess ship will be based in Singapore from the end of 2014. The firm told AFP that it expects cruise liner passengers in Asia to rise from around 1 million currently to 7 million by the end of the decade.

Double-digit earnings growth anchors investment case
City forecasters expect earnings per share to bounce back in the year ending Nov. 2013 after last year’s disastrous 23% drop to 118 pence. Growth of 14% is expected this year, to 134 pence, before steaming 22% higher in 2014 to 164 pence.

The holiday specialists currently change hands on a P/E ratio of 16.6 and 13.6 for this year and next, providing a discount to a forward earnings multiple of 17.6 for the broader travel and leisure sector.

Despite Carnival‘s earnings pressure in 2012, the company still hiked its dividend 21% to 63.5 pence per share, and broker estimates expect this to continue rising in the medium term. Payouts of 73.3 pence and 82.8 pence are penciled in for 2013 and 2014, correspondingly, up 15% and 13% on an annual basis and providing yields of 3.3% and 3.7%.

Not only are dividends set to shoot above the 3.2% average yield for the FTSE 100, but this exciting dividend growth is also expected to remain well protected, with coverage of 1.8 times and two times for this year and next around the widely regarded security threshold of two times.

Bolster your investment income with the Fool
If you already hold shares in Carnival and

Source: FULL ARTICLE at DailyFinance

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Should I Buy Rio Tinto or BHP Billiton?

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By Roland Head, The Motley Fool

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LONDON — After making strong gains toward the end of last year, shares in miners Rio Tinto  and BHP Billiton  have fallen by around 10% since the beginning of 2013.

The falls have been caused by institutional shareholders trimming their holdings in each company — but I believe this is a great opportunity to buy into these two world-class companies at very attractive prices.

Rio Tinto vs. BHP Billiton
‘m going to start with a look at a few key statistics that can be used to provide a quick comparison of these two companies, based on their last published results:

Value

Rio Tinto

BHP Billiton

2012 revenue

£33,529

£44,043

P/E ratio

9.5

11.9

Dividend yield

3.5%

3.9%

Net gearing

41%

45%

Both Rio and BHP made paper losses last year, after writing down the value of several major assets. The P/E ratios I’ve included in the table above are based on underlying earnings, which I think provides a more realistic view of each company’s performance.

The income available from both companies is also attractive — both dividend yields are above the FTSE 100 average of 3.2%, making them worth considering for a diversified portfolio of income shares.

I expect Rio’s and BHP‘s dividends to continue to grow over the next few years, as both companies have said they will cut back capital expenditure on new projects, and focus on maximizing their profitability and enhancing shareholder returns.

What’s next?
Analysts’ forecasts are notoriously unreliable, but FTSE 100 companies generally get the benefit of the most comprehensive analysis, and tend to deliver fewer surprises than smaller companies.

With that in mind, let’s take a look at the forecasts for Rio Tinto and BHP Billiton. These apply to the companies’ current financial years, which end in June (BHP) and December (Rio):

 

Rio Tinto

BHP Billiton

Forecast P/E ratio

7.2

11.3

Forecast dividend yield

3.7%

4%

Forecast dividend growth

6.3%

5.2%

Forecast earnings growth

26%

(32.0)%

These figures, which are based on the companies’ guidance figures and analysts’ forecasts, suggest that Rio may be nearer the end of its consolidation phase than BHP, which is expected to deliver another year of disappointing earnings.

It’s worth taking a brief look at the main commodities produced by each company. Around 75% of Rio’s earnings come from iron ore, while the remainder is split between aluminum, copper and coal.

In BHP‘s case, around 50% of earnings from iron ore, while around 25% comes from oil and gas production, mostly in the U.S. The remainder comes mostly from copper, aluminum and coal.

Which share should I buy?
BHP‘s major commitment to oil and gas is something to consider if you want a diversified portfolio, as it could take you overweight on oil if you also hold shares in a supermajor like BP or Royal Dutch Shell.

On the other hand, BHP does offer exposure to all the major industrial commodities in one share, which may be attractive, depending on your requirements.

I prefer Rio’s focus on mining, rather than petroleum, and I like its growing emphasis on copper. For all of these reasons, Rio is my pick as a buy — but I

Source: FULL ARTICLE at DailyFinance

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Eyes Down for Tesco's Results

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By G. A. Chester, The Motley Fool

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LONDON — Top British supermarket Tesco  is due to announce its annual results on April 17.

At the time of writing, Tesco’s shares are trading at 380 pence — up 17% from a year ago compared with a 13% rise for the FTSE 100.

How will Tesco’s businesses have performed in 2012/13 compared with the previous year? And will the results justify the strong performance of the shares? Here’s your cut-out-and-check results table!

 Metric

FY 2011/12

Forecast
FY 2012/13

Forecast
Growth

Revenue (excluding VAT, including petrol)

65.2 billion pounds

66.2 billion pounds

+1.6%

Trading profit

3.8 billion pounds

3.4 billion pounds

-9.6%

Trading margin

5.8%

5.1%

  

Underlying profit before tax

3.9 billion pounds

3.5 billion pounds

-10.6%

Underlying earnings per share (EPS) (diluted)

37.41 pence

33.23 pence

-11.2%

Dividend per share

14.76 pence

14.68 pence

-0.5%

Source: Tesco website.

Tesco’s results for the year ended Feb. 23, 2013 will take in the first full year since the company’s shock profit warning of Jan. 2012. The performance of the U.K. business was the cause of the profit warning, and chief executive Philip Clarke pledged 1 billion pounds of investment to get the core home operations back on track.

The success of the strategy — if it comes — won’t be visible in the 2012/13 numbers. Analysts are expecting modest revenue growth of 1 billion pounds (1.6%), but a 4 billion-pound drop in profits (down in the region of 10%) — with EPS falling a little more than 11%.

The current forecasts are actually poorer than six months ago, when analysts had penciled in revenue growth of around 3% and only mid-single-digit profit and EPS declines.

U.K. operations

The key U.K. operational number to watch out for is like-for-like sales (excluding VAT and petrol). The table below shows the trajectory across the past seven quarters.

 

Q1 2011/12

Q2 2011/12

Q3 2011/12

Q4 2011/12

Q1 2012/13

Q2 2012/13

Q3 2012/13

Growth

(0.1%)

(0.9%)

(0.9%)

(1.6%)

(1.5%)

0.1%

(0.6%)

Tesco managed to stem the tide of declining like-for-like numbers in the most recent second quarter, but like-for-likes turned negative again in Q3. Keep an eye on the Q4 number, which should be pretty decent given the comparison is with the poor Christmas trading period that resulted in the profit warning.

At the Q3 stage Tesco said most of its focus to date had been on the food business, which showed like-for-like sales up 1.2% for the quarter. As such, watch out for the split between food and non-food in Q4. Will Tesco have made any progress in turning around non-food? If not, what plans are there for doing so?

Finally — and perhaps the acid test of Clarke’s strategy — is whether getting Tesco’s U.K. business back on track will require further investment on top of the 1 billion pounds spent to date.

Overseas operations
One of the spurs for Tesco’s high-flying share price was the announcement last December of a strategic review of the company’s loss-making U.S. Fresh & Easy business.

At the time, Tesco claimed it had received “a number of approaches” from parties interested in acquiring all or part of the business or in partnering Tesco in developing the operation. Clarke promised to report on progress in the upcoming results.

The Telegraph has recently claimed

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Should I Buy Polymetal International?

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By Harvey Jones, The Motley Fool

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LONDON — I’m window shopping for shares again, and there are plenty of goodies for sale. Should I pop Polymetal International  into my basket?

Go West, go East
Russian gold and silver producer Polymetal International sought the greater security of a FTSE 100 listing in 2011 in a bid to attract a wider investor base, boost liquidity and reduce political risk. I’m tempted by the prospect of Western standards of corporate governance and Eastern growth potential. Should I buy it?

Polymetal International’s share price has plummeted nearly 25% over the past six months, but publication of its preliminary 2012 results earlier this week sparked a sudden 6% rebound. That’s down to its “strong operational performance”, which included a 31% rise in gold production and a 40% leap in revenues to $1.85 billion dollars. Adjusted EBITDA grew a forecast-busting 47% to $918 million. Polymetal also fulfilled its promise to pay 30% of net earnings to investors (up from 20% last year), paying 31 cents a share (on top of a special dividend of 50 cents in January). Management has floated the idea of making a special payment every December, if cash flow allows. Given its strong cash position, Polymetal could be a nice little income earner.

Gold bugs
This week, Polymetal also announced that it had completed its purchase of the Maminskoye gold deposit in Sverdlovks, Russia, which it claims has “substantial exploration upside”, and could yield between 80,000 and 120,000 ounces of gold a year. That’s another advantage of a FTSE 100 listing. It makes equity-based acquisitions easier.

Polymetal is sitting pretty, thanks to its strong financial performance, stable cash flow, solid margins and healthy return on capital, and is already on track to meet its gold production targets for 2013. Commodity stocks have struggled in recent months, but that could make now a buying opportunity. Polymetal currently trades at 13.2 times earnings, and although that isn’t dirt cheap, you aren’t paying over the odds, either. You get a forecast yield of 3.7%, and an exciting dividend policy. Projected earnings-per-share growth is a shiny 56% this year, followed by 15% in 2014.

Chinese arithmetic
Your decision to buy will partly depend on how bullish you are about the global recovery. But with central bankers competing to pump liquidity into the economy, and Chinese domestic consumption rising, the tide could be moving in favor of commodities. Brokers rate Polymetal. Canaccord Genuity names it a buy, with a target price of £14, Morgan Stanley is overweight on a target of £11.25. You can currently buy it for £9.

As with every miner, you have to understand the risks. This is a volatile sector. Polymetal is still relatively new to the FTSE 100 index, while three major shareholders continue to dominate its board. The gold price is down 10% over the last six months, and any serious decline could hit investor sentiment. But if you think metals are set to get more precious over the next

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

The Stocks That Margaret Thatcher Gave Us

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By Tony Reading, The Motley Fool

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LONDON — Baroness Thatcher will be remembered for many reforms, but one of enduring legacy for investors is that she gave us the stock market we know today.

Privatization became a key plank of economic policy, and nine of the firms in the FTSE 100 are the direct descendants of state-owned companies privatized during her time as prime minister.

Thirty five years ago, the precursors to BP , BAE , International Consolidated Airlines , BT , Rolls-Royce , BG, Centrica, Severn Trent and United Utilities were all state-owned enterprises. Today. they are successful blue-chip firms with a combined market capitalization of over £200 billion.

1. BP
Privatization had started in 1977 when the Labor government of James Callaghan sold a 32% stake as part of the conditions of the country’s IMF bailout. Under Margaret Thatcher‘s watch the remaining stake was sold, with two big sales in 1979 and 1987. The 1987 offering coincided with a stock market crash and the stock was left with underwriters, costing them billions.

BP subsequently grew to become the FTSE‘s biggest dividend payer, but the U.S. Deepwater Horizon disaster put paid to that. With a new alliance with Russia‘s state-owned oil company, it’s set to resume its former upwards trajectory.

2. BAE
British Aerospace (BAE) was sold off in two chunks in 1981 and 1985. BAE struggled in the 1990s and merged in 1999 with Marconi to become BAE Systems. BAE sold its 20% of Airbus to EADS in 2006 to concentrate on defense, only for new management to seek a merger with EADs in 2012 to regain exposure to commercial aerospace.

Poor strategic management may have been a counterweight to superb engineering, but a 5% yield in a — literally — defensive sector makes the company an attractive investment.

3. BT
Half of British Telecom was privatized under Margaret Thatcher in 1984, with the remaining shares sold off in 1991 and 1993. It was the first of the blockbuster utility privatizations, with the company at the time enjoying a virtual monopoly (a consortium, Mercury Communications, provided nominal competition).

Shareholders have had a roller-coaster time, with the changing structure of the industry and the technology bubble. More recently, a push into broadband has given the company a new lease of life.

4. IAG
British Airways was fully privatized in 1987, in an offer that was 11-times oversubscribed. It grew in scale with the acquisition of British Caledonian, and then in profit under CEO Willie Walsh, who did some union-wrestling of his own.

IAG was formed from the merger of British Airways and Iberia in 2010, to enjoy greater global scale. However, management is now hampered by Spanish union intransigence.

5. Rolls-Royce
Rolls-Royce is an oddity in the privatization program. It had been nationalized by Lady Thatcher‘s predecessor Edward Heath in 1971 to save it from administration after cost over-runs on the RB211 engine. The Thatcher government returned it to the private sector in 1987, since when it has prospered to be one of three global manufacturers of big engines.

In a companion piece, I’ll cover the four utility stocks.

Margaret Thatcher believed in individuals taking

Source: FULL ARTICLE at DailyFinance

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The Stock Picker's Guide to GlaxoSmithKline

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By Tony Reading, The Motley Fool

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LONDON — Successful investors use a disciplined approach to picking stocks, and checklists can be a great way to make sure you’ve covered all the bases.

In this series I’m subjecting companies to scrutiny under five headings: prospects, performance, management, safety and valuation. How does GlaxoSmithKline  measure up?

1. Prospects
The pharmaceutical industry is riding a demographic wave of aging populations in developed countries and increasing wealth in developing ones. However, many companies are suffering competition from generic manufacturers as patents expire.

GSK is one of the world’s biggest drug makers, giving it the firepower to spend heavily on R&D, and it has a promising pipeline. Vaccines and consumer health care products (30% of sales) provide stability and the latter helps GSK‘s big push into emerging markets.

2. Performance
Turnover has been gently declining in recent years, but this trend is expected to reverse as new drugs come on stream from the end of this year. Operating profit has been variable, but GSK earns gross margins above 20%.

2.5 billion pounds per year has been stripped out of costs in recent restructurings, and the company expects to strip another 1 billion pounds by 2016.

3. Management
Sir Andrew Witty started with the firm as a graduate trainee and has been CEO since 2008. He has steered the strategy of diversification, penetration of emerging markets, and cost-cutting. He also dealt effectively and decisively with past regulatory abuses in the U.S.

The chairman is City grandee Sir Christopher Gent, who took Vodafone from a start-up to FTSE 100 membership. Together with a former Goldman Sachs M&A banker as finance director, the board is a formidable deal-making machine, but perhaps not excessively risk-averse.

Directors have substantial shareholdings.

4. Safety
GSK‘s balance sheet is its Achilles’ heel. Net gearing is 240%. However, the debt is mostly long term, with about half having a maturity over five years. Reassuringly, interest cover is a healthy nine times.

15 billion pounds of GSK‘s 6.7 billion pound equity is represented by intangibles, so tangible net assets are negative. But nearly 10 billion pounds of the intangibles is patents and brands, which have real monetary value.

Cash conversion is good, with 90% of GSK‘s profit before tax flowing through as cash. Fixed costs of interest, dividends, capex and R&D still leave surplus for share buybacks.

5. Valuation
A historic price-to-earnings ratio of 16.8 looks expensive, but it drops to 13.2 on a prospective basis. The stock is yielding 4.8%, rising to 5.1% next year, and the fat yield in a defensive sector is the reason many investors hold the stock.

GSK has a superlative track record of rising dividends over 20 years, though sometimes that’s meant dividend cover has dropped to 1.25 times.

Conclusion
Despite its over-geared balance sheet and the industry’s patent cliff, GSK is a relatively safe play with a juicy yield to reward investors, and promising prospects.

One of GSK‘s biggest shareholders is Invesco Perpetual‘s star fund manager Neil Woodford. Nearly a quarter of his 22 billion pound funds are invested in just three companies in the

Source: FULL ARTICLE at DailyFinance

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3 More FTSE 100 Shares Going Ex-Dividend Next Week

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By Alan Oscroft, The Motley Fool

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LONDON — We’ve already looked at three FTSE 100 companies set to go ex-dividend next week, but it’s a busy week as payments from firms with years ending in December approach, so here are some more from the top-flight index.

As long as you are holding shares in the following three companies up to April 17, you’ll be in the money — or, if they should fall after that date, you might be able to pick up a bargain.

Tullow Oil
Shareholders in Tullow Oil are set to receive a final dividend of 8 pence per share, taking the total annual payout to 12 pence. That’s exactly the same as the previous year and provides a yield of just 1% on the current share price of 1,179 pence. It’s perhaps not a great compensation for the firm’s share price fall of about 17% over the past 12 months — but long-term shareholders have done well with Tullow, as the shares are up 16-fold over the past decade.

Smith & Nephew
With its full-year results on Feb. 7, Smith & Nephew announced a 50% lift of its final dividend to 16.2 cents per share. Added to the interim payment, it made a total of 26.1 cents per share for the year. On today’s price of 752 pence per share, that’s a yield of about 2.3%.

The orthopedics, endoscopy, and wound-care specialist is expecting market conditions for 2013 to remain similar to last year’s, but we hope to see more of what the company described as “a move to a progressive dividend policy.”

Resolution
Resolution is our final pick to go ex-dividend next Wednesday, and again it’s a final payment. This time it amounts to 14.09 pence per share, taking the full-year dividend up 6.3% to 21.14 pence and providing an annual yield of 7.9% on the current price of 268 pence. The income will be available only as cash, as the insurance sector restructuring specialist has discontinued its scrip dividend program.

Going forward, the firm will consider a progressive dividend policy once sustainable cash-generation reaches 400 million pounds per year, and it plans to pay one-third of its annual dividend at the interim stage each year.

Dividends like these can add nicely to your investment returns — they can be spent or reinvested, according to your needs. Whether you’re investing for income or growth, good old cash is always welcome. And that’s why I recommend the brand-new Fool report “The Motley Fool’s Top Income Share For 2013,” in which our top analysts identify a share they believe will provide handsome dividend income for years to come. But it will only be available for a limited period, so click here to get your copy today.

The article 3 More FTSE 100 Shares Going Ex-Dividend Next Week originally appeared on Fool.com.


Alan Oscroft has

Source: FULL ARTICLE at DailyFinance

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Why Halfords, Genel Energy, and Daisy Beat the FTSE 100 Today

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By Alan Oscroft, The Motley Fool

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LONDON — We saw a bit more life in the FTSE 100 today. The leading U.K. index rose 1.17% to close at 6,387 points. Further recoveries in the mining sector are helping, but the big banks are beating them with bigger rises today. We’ve had mixed news from China, too: Inflation is lower than expected, but a trade deficit might indicate rising domestic demand.

Which other companies are doing well? Here are three from the various indexes that climbed today.

Halfords
A pre-close update sent Halfords Group shares up 1% to 319 pence this morning. Overall sales for the year at the car parts and cycling specialist should be up around 1% — but we should be seeing a 13.5% increase from Halfords Autocentres after a further 12 outlets were opened during the final 11 weeks

Pre-tax profit should be around 68 million pounds to 72 million pounds, which is in line with previous expectations. There is no mention of dividends as yet, though City analysts have been steady for months with a forecast of 22 pence per share, which would provide a yield of more than 7% — but it would be barely covered and is by no means certain. Results are due on May 23.

Genel
Genel Energy‘s share price popped 6.4% to 850 pence on the news of a “significant” oil discovery in the Kurdistan region of Iraq. The explorer plans to drill five exploratory wells in its Chia Surkh license area — and hit paydirt on the first attempt!

The company hit the black stuff at a depth of 1,700 meters and has estimated a likely flow of up to 11,950 barrels of oil per day. The firm also believes it has found up to 15 million cubic feet of gas.

Daisy
Shares in Daisy Group climbed 6% to 131 pence after the telecom operator told us of its first-ever dividend. In a pre-close update today, the firm that offers combined voice and data services to smaller businesses told us it plans to announce a maiden 4 pence per-share payment on results day on June 18.

On today’s price, that would provide a yield of 3%, which isn’t bad for starters, and the firm intends to lift its payout by 15% per year for the next two years. The results should be “materially ahead of current market expectations,” with net debt lower than expected.

Finally, if you’re looking for investments that should take you all the way to a comfortable retirement, I recommend the Fool’s special new report detailing five blue-chip shares. They’ll be familiar names to many, and they’ve already provided investors with decades of profits. But the report will only be available for a limited period, so click here to get your hands on these great ideas — they could set you on the road to long-term riches.

The article Why Halfords, Genel Energy, and Daisy

Source: FULL ARTICLE at DailyFinance

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Why Ophir Energy, Dunelm, and Sirius Minerals Lagged the FTSE 100 Today

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By Alan Oscroft, The Motley Fool

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LONDON — The FTSE 100 was going steady today until the last couple of hours of trading, when it spiked to close 1.17% higher at 6,387 points, thanks in part to the mining and banking sectors. That comes after slower inflation in China helped Asian and U.S. markets to higher finishes yesterday, though there are still fears of overheating consumer demand in China.

Although the index rose today, there are always individual shares falling. Here are three that slipped today.

Ophir Energy
Shares in Ophir Energy dropped 2.8% even though the firm upped its resource estimates for its Jodari field in Tanzania by 700 billion cubic feet to 4.1 trillion cubic feet. The company is also planning a drill stem test at its Mzia-2 field, scheduled for completion by the end of the month. Once these testing phases are complete, Ophir plans to start drilling at its Ngisi prospect, and it has also secured a drilling ship for its Starfish-1 well off the shore of Ghana.

Dunelm
Soft-furnishings retailer Dunelm Group announced a 15.4% rise in third-quarter revenue, with like-for-like sales up 5.2% — and the share price fell 0.8% to 841 pence! The outlook for the rest of the year is behind the fall: Q3 figures were boosted by a late end to the firm’s winter sale and an early Easter. Chief executive Nick Wharton warned, “We anticipate that sales growth in like for like stores will become much harder to achieve in the remainder of the current financial year,” compared with a strong final quarter last year.

Sirius Minerals
Potash miner Sirius Minerals saw its shares drop by 1.2% to 21.5 pence today despite positive results from coring tests at its York Potash project — the company has found 58 meters of 88% polyhalite within a total length of 72.4 metres. In the words of chief executive Chris Fraser, “These preliminary results provide further confirmation of the volume, quality and consistency of the York Potash polyhalite orebody.”

Finally, reliable dividends can more than compensate for the day-to-day ups and downs of share prices. So how about a company that’s offering a 5.7% yield and could be set for some nice share-price appreciation, too? It’s the subject of our brand-new report “The Motley Fool’s Top Income Share For 2013,” which you can get completely free of charge — but it will only be available for a limited period, so click here to get your copy today.

The article Why Ophir Energy, Dunelm, and Sirius Minerals Lagged the FTSE 100 Today originally appeared on Fool.com.


Alan Oscroft has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all

Source: FULL ARTICLE at DailyFinance

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Dow May Open Higher After Chinese Imports Beat Expectations

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By Roland Head, The Motley Fool

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LONDON — Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open up by 0.29% this morning, while the S&P 500 may open 0.26% higher. The Dow closed at a new record high of 14,673.46 yesterday, but the CNN Fear & Greed Index remained almost unmoved at 53, or “neutral.”

European markets moved strongly higher this morning after Chinese import and export figures beat analysts’ forecasts. Imports rose by 14.1% in March, while exports rose by 10%, boosting trade hopes for European companies. At 7:20 a.m. EDT, the German DAX was up 1.16%, and the French CAC 40 was 1.18% higher. In London, the FTSE 100 was up 0.76%, helped by a strong showing from mining firms and financial stocks, which collectively make up the majority of the index’s capitalization.

In the U.S. today, investors are likely to focus closely on the minutes of March’s Federal Open Markets Committee meeting, which may provide some insight into the current thinking of the Fed’s interest rate-setting committee. The minutes are due to be published at 2 p.m. EDT, when details of March’s federal budget are also due to be released.

In other news, the Mortgage Bankers Association reported earlier this morning that its weekly mortgage-applications index increased 4.5% following a 4% decline the previous week. The EIA weekly petroleum status report is due at 10:30 a.m. EDT.

Companies due to report quarterly earnings before markets open this morning include Constellation Brands, CarMax, MSC Industrial Direct, and Bed Bath & Beyond. Earlier this morning, Fastenal reported quarterly earnings of $0.37 per share, an 8.8% increase on the same period in 2012. Fastenal also announced a $0.20 cash dividend for the second quarter of 2013.

Stocks that may be actively traded today include Herbalife, which slid nearly 4% before markets closed yesterday after it revealed that its auditor, KPMG, was to resign. The decision is the result of insider-trading allegations against the KPMG partner responsible for auditing the nutritional-supplements company, which is already the subject of a war of words between activist investors Carl Icahn and William Ackman. Trading in J.C. Penney shares may also be heavy after the retailer’s share price slid a further 12% in trading yesterday. The company’s shares have now fallen almost 60% over the last year.

Finally, let’s not forget that the Dow’s daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.” If you, like Buffett, are convinced of the long-term power of the Dow, you should read “5 Stocks To Retire On.” Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

The article Dow May Open Higher After Chinese Imports Beat Expectations originally appeared on Fool.com.

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Source: FULL ARTICLE at DailyFinance

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Can Diversification Power Tesco's Growth?

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By Tony Reading, The Motley Fool

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LONDON — Before its infamous profit warning, Tesco  stood out in two ways: Its U.K. grocery market share of 30% was double its rivals, and it was more diversified.

The company has remained sotto voce about diversification while repairing the neglected U.K. grocery business. And it would be too early to call the recovery of its core business. Its shares are still 6% off their pre-profit warning level, against a FTSE 100 rise of 13%.

But the company’s six-point plan to “Build a Better Tesco” through investment in training, stores, and price promotions is well under way, and there’s a strong chance of it proving successful. A dominant market share is a great starting point. The preliminary results, due next week, could be the platform for management to boast of progress.

So if the stock market is the future discounting mechanism it’s supposed to be, sentiment might soon switch back to focus more on Tesco’s distinct advantages.

Clever
One clever new strand of diversification helps the U.K. grocery business. Tesco aims to broaden the appeal of its large stores with family-friendly facilities. It bought the restaurant chain Giraffe last month, and has taken stakes in the Harris and Hoole coffee chain and the upmarket cakes and sandwiches chain Euphorium Bakery.

But the big diversifications are online, telecoms, banking, and geographically.

Everything digital
An online platform is a “need to have,” but Tesco can roll it out to its international businesses. It’s also the biggest virtual mobile phone network operator in the U.K. and has launched a movie-streaming service, Blinkbox.

Tesco’s bank is a stand-alone operation, much larger than Sainsbury‘s joint venture with Lloyds Bank. Recently, it started offering mortgages. With the reputation of the high-street lenders trashed and the U.K. government keen to make changing current accounts easier, Tesco Bank could become a serious player.

Overseas
Geographically, success has been mixed. Europe and Asia contribute more than 30% of total grocery sales, but Europe has been held back by the eurozone crisis.

Tesco’s failure in the U.S. is a warning of the dangers of overseas expansion. It now plans to exit, as it has done from Japan. But with limited room for growth domestically, Tesco’s foreign forays offer a potential upside over the other supermarkets, if it can get the execution right.

Yield
Yielding 3.9%, Tesco’s solid U.K. grocery business and diversified growth options earn it a place in my portfolio.

It’s also one of the stocks selected for “5 Shares to Retire On,” a brand-new report from The Motley Fool. It describes five shares that could form the core of any holding, whether you’re saving for retirement or shorter-term goals: companies with healthy balance sheets, dominant market positions, and reliable cash flows.

To find out more, you can download the report by clicking here — it will be delivered straight to your inbox and is completely free.

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The article Can Diversification Power Tesco’s Growth? originally appeared on Fool.com.


Tony Reading owns shares in …read more

Source: FULL ARTICLE at DailyFinance

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Should You Buy easyJet Today?

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By Royston Wild, The Motley Fool

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LONDON — Shares in budget airline easyJet  have steadily strode higher since the middle of 2011, and in the past six months alone have leapt more than 66%, striking all-time highs of 1,128 pence in the process.

And I believe that the stock still has much further to run owing to bursting growth prospects and an improving ability to grab custom from rival operators. Indeed, just today Morgan Stanley hiked its target price for the carrier’s shares by almost a third, to 1,375 pence, affirming easyJet’s chunky upside potential.

Airline ready to boost market share
easyJet announced in last week’s trading statement that it expects revenues per seat to have risen 8.5% in the September-March period, beating a projected rise of between 6% and 8%, and propelled by stronger-than-forecast late bookings in the run up to the Easter break.

Although overall capacity rose 3.3% from the corresponding 2012 period, falling short of a projected 3.5% increase, this was caused by weather-related cancellations. And passenger numbers rose 5.3% in March, it added.

The company halved first-half losses year-on-year, which is now predicted to come in between £60 million and £65 million. Indeed, cost per seat (excluding fuel) rose 3.5%, at the lowest point of estimates due to the firm’s effective cost-management plan during the winter.

I fully expect easyJet to sustain future growth by grabbing market share from other major industry players. Higher-cost rivals such as Iberia and Air France are reducing the number of routes served, as well as flight frequency on the remaining routes, giving rivals such as easyJet room to muscle in.

Furthermore, I believe airlines with the capacity to offer cheaper services are likely to remain in vogue while the beleaguered economic backdrop in Europe continues to strike travellers’ wallets.

Earnings growth expected to soar
Broker Investec expects earnings per share to explode 35% in the year ending September 2013, to 83.4 pence, before galloping 12% higher the following year to 93.1 pence.

The airline currently changes hands on a P/E rating of 12.4 and 11.1 for 2013 and 2014 respectively. This represents a healthy discount to a forward earnings multiple of 13.1 for budget airline rival Ryanair Holdings, and 17.6 for the wider travel and leisure sector.

As well, easyJet’s status as a value stock is exemplified by a price/earnings to growth readout of 0.4 and 0.9 for this year and next. Any value below one is considered excellent value for money.

The canny guide for clever investors
If you already hold shares in easyJet, check out this newly updated special report that highlights a host of other FTSE winners identified by ace fund manager Neil Woodford.

Woodford — head of U.K. Equities at Invesco Perpetual — has more than 30 years’ experience in the industry, and boasts an exceptional track record when it comes to selecting stock market stars.

The report, compiled by The Motley Fool’s crack team of analysts, is totally free and comes with no further obligation. Click here now to download your copy.

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Source: FULL ARTICLE at DailyFinance

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Why I'm Banking on Barclays

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By Sam Robson, The Motley Fool

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LONDON — Over the last year, I’ve slowly been building up a small portfolio that currently consists of an income share, a growth story, and a contrarian play, across different industries that include insurance, alcohol, and telecommunications.

My best performing share has arguably been Vodafone, which has yielded healthy dividends, and I’ve seen the share price recover over time following a dip soon after I bought in — further evidence that the Foolish philosophy of buying shares that you’re only prepared to hold for three to five years at least — and resisting short-term market turbulence — pays off! From a growth perspective, however, Diageo is the front-runner in my portfolio, having seen a 7.2% increase since I bought them in mid-January.

As we enter into April and a new British tax year, though, I have been looking for new shares to invest in — and, in the interest of further diversification, I’ve been looking at the banking sector. Specifically, the one that’s caught my eye is Barclays  . 

Now, I know that banks and their top brass have taken a battering in recent times, but I took an interest in Barclays when new CEO Anthony Jenkins revealed the bank would be shoring up its U.K. operations and providing more transparency for its shareholders — for example, Barclays will be reviewing 75 of its business units to determine which can provide a decent return without further threatening the company’s reputation.

Yielding around 2.3%, it also pays a dividend — unlike its high-street banking rivals Lloyds and RBS — while Jenkins has also declared his intention to eventually pay shareholders 30% of earnings, and a return on equity above 11.5% (currently 7.8%, up from 6.6% last year).

The recent turbulence in the eurozone caused by Cyprus rippled through the FTSE, causing the U.K.’s premier index to dip and many of its constituents — especially banks — to fall back with it. However, I believe that a continued economic recovery will see Barclays share price motor, and led by a strong management team with Jenkins at the helm and the new wave of shareholder transparency that has been promised, I believe that its current price of 285 pence represents a buying opportunity, and I have added the bank’s shares to my portfolio.

If you’re looking for companies outside of the banking sector that have strong potential to soar in price, then we’ve pinpointed our favorite growth share from elsewhere in the FTSE 100. The Motley Fool’s top analysts have produced a free report in which they evaluate its finances and risks, and its growth prospects going forward. Simply click here to get your copy delivered to your inbox immediately — it’s completely free.

The article Why I’m Banking on Barclays originally appeared on Fool.com.

Sam owns shares in Vodafone, Diageo and Barclays. The Motley Fool has recommended shares in Vodafone. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Why ICAP, Victrex, and Centamin Should Lag the FTSE 100 Today

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By Alan Oscroft, The Motley Fool

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LONDON — The FTSE 100 has been lifted by rising mining shares today, up 0.45% to 6,305 points as of 8:15 a.m. EDT after the latest inflation figures from China were lower than expected, boosting expectations of a continuation of the country’s stimulus policies.

But not all shares are going up. Here are three constituents of the various FTSE indexes that are lagging today.

ICAP
ICAP shares have dropped 0.17% to 292 pence after the interdealer broker was moved to comment on press speculation regarding an investigation by the Commodity Futures Trading Commission into the possible manipulation of prices for the ISDAfix benchmark for swap rates.

Telling us that it does not make submissions to ISDAfix but is involved in the administration of part of the process, the firm said, “ICAP had no knowledge of the allegations prior to the media speculation, and is investigating them.”

Victrex
Despite a first-half update from Victrex telling us that sales volumes are ahead of last year, the company’s shares have fallen 1% to 1,578 pence. The firm, which makes speciality polymer materials, shipped 1,392 tonnes compared to 1,377 tonnes in the first half of last year. The company describes its order book for April as “robust.”

Despite a small reversal since the middle of March, Victrex shares have had a strong run of late, gaining a third since last July.

Centamin
Shares in Centamin, the Egypt-based gold miner, have dropped 4.8% despite the release of a solid first-quarter production update. Gold production from Centamin’s Sukari mine for the period amounted to a record 87,016 ounces, up 77% on the same period last year and up 2% on 2012’s fourth quarter.

Chairman Josef El-Raghy said that, “This marks a solid start to the year and output remains on target to achieve the 2013 guidance of 320,000 ounces,” and he told us the firm’s planned stage-four expansion is on course for an end-of-year completion.

Finally, reliable dividends can more than compensate for the day-to-day ups and downs of share prices. So how about a company that’s offering a 5.7% yield and could be set for some nice share-price appreciation, too? It’s the subject of our brand-new report “The Motley Fool’s Top Income Share For 2013,” which you can get completely free of charge — but it will only be available for a limited period, so click here to get your copy today.

The article Why ICAP, Victrex, and Centamin Should Lag the FTSE 100 Today originally appeared on Fool.com.


Alan Oscroft has no position in any stocks mentioned. The Motley Fool recommends Victrex. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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Source: FULL ARTICLE at DailyFinance

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Why FirstGroup, Vedanta Resources, and Shanks Should Beat the FTSE 100 Today

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By Alan Oscroft, The Motley Fool

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LONDON — The FTSE 100 has risen 0.57% to 6,313 points this morning. The main force behind the U.K.’s top-tier index appears to be the miners, which are generally up around 2% to 3%. And those in turn were buoyed by lower-than-expected Chinese inflation figures, which raise hopes that the economy will keep growing.

But which companies are beating the indexes today? Here are three that are rising.

FirstGroup
FirstGroup shares have picked 2.9% to 207 pence after the rail and bus operator told us that full-year trading is going as expected. In a statement ahead of results due on May 22, the firm reminded us that its interim dividend was held but told us that it has still to decide on this year’s final payment. It’s hard to predict anything right now, with the West Coast rail franchise still on hold.

Should the final payment also be held at last year’s levels, we’d be seeing a yield of more than 11% — though many will surely be expecting to see a cut. If earnings come in close to the latest City forecasts, the shares will be on a price-to-earnings ratio of about seven.

Vedanta Resources
Shares in Vedanta Resources have gained 3.8% to 1,100 pence after the company’s Indian exploration subsidiary announced an oil discovery in Rajasthan. Cairn India‘s latest strike takes the total number of discoveries in the RJ-ON-90/1 block to 26.

A gross oil column of approximately 10 meters was found this time, and evaluation of potential oil volume will be the next stage. Vedanta shares had been sliding since the start of the year, but they have regained about 10% in the past week.

Shanks Group
Waste management specialist Shanks Group saw its shares rise 1.3% to 75.5 pence following an upbeat end-of-year update told us that trading has continued “robustly.” Despite bad weather hampering the firm’s operations, we should see full-year results in line with previous expectations.

Management of costs has been the key issue in “very challenging” market conditions, and the current plan is expected to save about 20 million pounds per year by fiscal year 2016. Results should be released on March 31.

Finally, if you’re looking for investments that should take you all the way to a comfortable retirement, I recommend the Fool’s special new report detailing five blue-chip shares. They’ll be familiar names to many, and they’ve already provided investors with decades of profits. But the report will only be available for a limited period, so click here to get your hands on these great ideas — they could set you on the road to long-term riches.

The article Why FirstGroup, Vedanta Resources, and Shanks Should Beat the FTSE 100 Today originally appeared on Fool.com.


Alan Oscroft has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks …read more

Source: FULL ARTICLE at DailyFinance