The FTSE 100 might be in an erratic phase as we near year-end, but some investors will be very happy as their shares climb to new highs.
National Grid
The FTSE has fallen by a third of a percent over the past 12 months, but National Grid (LSE: NG) (NYSE: NGG.US) shareholders won’t care about that — they’re up 21% as their shares reached a 52-week high of 942p today. And on top of that, they look set to enjoy a dividend yield of around 4.5%.
Coming off a five-year spell of strong earnings growth, National Grid is forecast to report a small drop in EPS for the current year, but even with that the shares are on a forward P/E of only around 16 — it’s above average, but it looks pretty good to me for such a strong dividend payer.
More to come? I think so.
British American Tobacco
British American Tobacco (LSE: BATS) (NYSE: BTI.US) took a bit of a dive earlier this year, hitting a low of 2,871p in February. But since then the price has risen 796p to a 52-week high of 3,667p today, before dropping back a little to 3,652p as I write. That’s a gain of 25% from low to high, and rescues what was looking like an under-performing year — over 12 months the shares are up 7%, beating the FTSE.
The company was boosted by first-half results in July which showed that, though overall cigarette volumes are still falling, key markets and “Global Drive” brands are on the up.
A drop in the value of sterling has almost certainly helped too — the strong pound looks set to turn a constant-exchange-rate rise in EPS into a fall at actual rates, but the effect should be less now than it appeared at one stage.
Dixons Carphone
Dixons’ recovery since its near-fatal crunch during the recession is now almost legendary, and since its merger with Carphone Warehouse to produce Dixons Carphone (LSE: DC) things have been getting even better. Since the two firms combined their efforts in August, the share price has climbed 20% to today’s 412p, while the FTSE has been boringly flat over the same period.
Analysts seem bullish too, and there’s a modest 7% EPS growth pencilled in for the year to March 2015 followed by 24% for the firm’s first full year as a combined entity to March 2016. Dividends for the current year should be modest with a yield of only around 1.7%, but that’s expected to rise to 2.2% the year after — and growth at that rate should produce a decent yield before too long.