Today I am looking at three FTSE 100 (INDEXFTSE: UKX) giants that could be considered far too expensive at current levels.

Supermarket struggles

While signs of revenue improvement have propelled its share price from January’s multi-year lows, I believe Tesco (LSE: TSCO) has remained grossly overvalued for some time now. It appears the market still cannot accept that the retailer — for so long the pinnacle of British retail strength — is slowly falling from its perch.

The Cheshunt firm is fighting a losing battle against the competition, with its inability to beat Aldi and Lidl on price, or Waitrose and Marks & Spencer on quality, leaving it between a rock and a hard place.

Sure, the decision to close scores of increasingly-unpopular ‘megastores’ is a step in the right direction. But Tesco needs to show it has the ideas and the mettle to strike back in what is an increasingly-fragmented marketplace — the chain’s commitment to profits-sapping price cutting simply isn’t cutting the mustard.

The City expects earnings at Tesco to more than double in the year to February 2017. I find these forecasts difficult to fathom, however, particularly after the firm warned last week that a “challenging, deflationary and uncertain market” will cause the recent profits recovery to slow in the current year.

 I therefore reckon Tesco’s massive P/E rating of 22.8 times is far too high given its lack of obvious growth drivers. Meanwhile, a miserly dividend yield of 0.6% — some way below the FTSE 100 average of 3.5%  — underlines the supermarket’s poor value for money.

Under pressure

Like Tesco, I believe the poor revenues outlook at BP (LSE: BP) makes the firm a bad investment destination at the present time.

A surging oil price has helped propel the fossil fuel play steadily higher in recent months. Indeed, the Brent benchmark struck five-month highs just today around the $46 per barrel marker following the International Energy Agency’s statement that “we are expecting the biggest decline in non-OPEC oil supply in the last 25 years.”

While that prediction may indeed come to pass, it does not mean that OPEC will not step into the void to grab market share. Indeed, the failure of Saudi Arabia and Russia to rubber-stamp an output freeze at the weekend underlines the massive political and economic considerations of reducing production.

And of course a cooling Chinese economy could throw a further spanner in the works for BP and its peers.

The London-listed business is expected to see earnings flatline in 2016, resulting in a massive P/E rating of 37.5 times. I believe this figure fails to reflect the huge risks facing the firm in the near-term and beyond as oil inventories continue to climb.

And while many will point to BP’s massive 7.7% dividend yield as its saving grace, I reckon the firm’s fragile balance sheet will see it struggle to meet current payout projections.

Silver struggler

Mining play Fresnillo (LSE: FRES) has also enjoyed a solid bump higher as investor sentiment towards the commodities sector has improved.

The Mexican producer has benefitted from the resurgent ‘store of value’ appeal of gold and silver as concerns over the health of the global economy abound. Meanwhile, a weakening US dollar and wider backcloth of low interest rates has also boosted the appeal of the precious metals.

However, I reckon Fresnillo’s recent ascent is built on sandy foundations. The City expects earnings to leap 273% in 2016. But this still results in an eye-watering P/E rating of 53.7 times. And a dividend yield of 0.8% hardly screams of terrific value, either.

This leaves plenty of room for a retracement, in my opinion, particularly as the probability of Federal Reserve rate hikes in the coming months should push the greenback higher once more. And of course slowing silver demand from China is likely to cast doubts over Fresnillo’s predicted earnings recovery, too.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended BP. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.