3 Shares Hitting New Highs
LONDON -- The FTSE 100 is continuing its upward climb, having gained 16 points, or 0.25%, to reach 6,354 by 8:15 a.m. EST. The banking sector has been helping to keep the U.K.'s top-tier index afloat after Barclays shares soared yesterday on the back of a 26% rise in profits.
And banks are in the news again today. We look at three FTSE companies scaling new heights.
Lloyds Banking Group is the latest of our big banks to reach a new record, with its shares closing on a 52-week high of 55.45 pence yesterday before dropping back a little today to 54.7 pence. Forecasts for the year ending December 2012 suggest a pre-tax profit of nearly 2 billion pounds, and the bank's third-quarter update reported underlying profit of 1.9 billion pounds for the nine months, so that looks promising.
But the real return to pre-crash profit isn't expected until 2013 and beyond, with about 3 billion pounds predicted this year and 4 billion pounds for 2014. On 2012 expectations, the price-to-earnings ratio is a high 20, but that falls to 13 and 10, respectively, for the next two years. Results for 2012 are expected on March 1.
Shares in cruise operator Carnival closed on a new high yesterday of 2,628 pence, though they have fallen back this morning to 2,602 pence. That's still a rise of about 35% over the past 12 months, putting the shares on a P/E of 17 based on forecasts for the year to November 2013.
This comes after a couple of years of falling earnings for the owner of the ill-fated Costa Concordia liner and reflects growing confidence in the travel and leisure sector in general. The full-year dividend yield is expected to be around 2.7%.
And in the same sector, easyJet shares are up to a 52-week high of 997.5 pence as I write. Overall, the price has more than doubled over the past 12 months, reinforcing the new management strategy forced through by Sir Stelios Haji-Ioannou.
After the company grew earnings per share for three straight years, forecasts suggest a further rise of about 25% this year, putting the shares on a P/E of 13. Is that high for an airline? Well, it's a risky business, but easyJet has rewarded shareholders so far.
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