5 Shares for the Week Ahead
Nov 9th 2012 3:52PM
Updated Nov 9th 2012 4:00PM
LONDON -- We have important news from FTSE 100 (UKX) companies on the calendar next week, including some anxiously awaited interim results. Here are five opportunities coming our way, which you might want to dig into a little first.
It's Vodafone (ISE: VOD.L) interim time on Tuesday. Vodafone had been seen as one of those unassailable success stories for years, as it expanded overseas and kept profits rising. It's been seen as a safe dividend investment, too, with a steadily growing payout of around the 5.5% mark.
But the love affair with Vodafone cooled after earnings fell this year, and the subsequent share price fall, to 167 pence from a high of 192 pence, puts the currently forecast dividend at a lofty 7.5%. Many doubt that's going to happen, but there is room for a cut in that forecast while still leaving a healthy payout -- just holding at last year's level would still yield a nice 5.7%. Vodafone is a constituent of the Fool's Beginners' Portfolio.
The supermarket business has been polarised this year, and we have interim figures from Sainsbury (ISE: SBRY.L) on Wednesday. Tesco is still in a slump after its poor pre-Christmas trading season, and at 322 pence it's 20% down over the year. And Morrisons has suffered similarly, down 15% to 264 pence.
But Sainsbury's shares have soared, recently peaking at 362 pence for a rise of over 20% on the year. They've fallen back a little since then, to 350 pence, but that's still an impressive performance. And even after that rise, current dividend forecasts still suggest a yield of 4.7%, in line with the other two.
Wednesday will bring us an interim management statement from Amec (ISE: AMEC.L) , the FTSE 100 engineering and project management company. Amec aims its services mainly at the oil & gas exploration and mining industries, providing us with one of those famous "picks and shovels" businesses -- like those who sold tools to the gold prospectors of old, they should do well no matter who hits paydirt.
Amec's shares have been up and down this year, getting up around 1,190 pence a couple of times, before falling back to today's 1,060 pence level -- but that's still 20% up on the past 12 months. Forecasts to December suggest a price-to-earnings (P/E) ratio of 14, and analysts have strong earning growth pencilled in for next year.
Investing in "picks and shovels" companies like Amec is one good way into the oil & gas industry. But many people want a more direct slice of the action -- after all, it's the companies that actually find the black stuff that make the biggest profits.
The utilities companies are often considered as cash cows by income investors, and we have interim results from two of the FTSE 100 giants next week -- SSE (ISE: SSE.L) on Wednesday, followed by National Grid on Friday.
The share prices of the two have done well this year, with SSE up 7% to 1,410 pence (though the price has been as high as 1,461 pence), and National Grid up 13% to 698 pence. But what of those all-important dividends? Well, the City has 5.8% forecast for the two of them for the year to March 2013.
As I mentioned our Beginners' Portfolio earlier, I'm going to indulge myself in this last slot and tell you of news of two more companies, one already in the portfolio and one on its watchlist -- you get seven shares for the price of five this week!
First up is small-cap video technology expert Blinkx, which provides interims on Wednesday. This year is not expected to be especially profitable, but there are great hopes for next year. With a 2014 P/E of 22, the shares are priced for growth -- but at 68 pence today, our portfolio is already on a tidy profit.
And finally, engineering and design consultancy WS Atkins, a company we have on the Beginners' watchlist, will release half-time results on Thursday.
If you're a beginner and you want to learn more about shares, but you're not sure where to start, download our latest guide -- " What Every New Investor Needs to Know ." We've written it specifically for learners taking their first steps, and it's free for a limited time.
So click here to have your copy delivered direct to your inbox, and you'll be on your way to getting things right, from the start.
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The article 5 Shares for the Week Ahead originally appeared on Fool.com.Alan does not own any shares mentioned in this article. The Motley Fool owns shares in Tesco, and 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 range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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