Private investors have been dismissing the prospects of Barclays PLC (LON:BARC), Vodafone Group plc (LON:VOD) and Tesco PLC (LON:TSCO). Have sellers made a huge mistake?
The FTSE 100 has had a great start to 2013. Markets cannot continue to rise in a straight line forever, though, and some shares have fallen in the last fortnight.
Using data from online stockbroker Selftrade, I have found three companies that investors were dumping in January. Could these shares confound the sellers and come back strong?
Barclays (LSE: BARC) (NYSE: BCS.US) has been in the wars this week. On Monday, shareholders learned that the bank's finance director, Chris Lucas, would be retiring.
This was followed today by the news that Barclays would be setting aside another £1bn to deal with Payment Protection Insurance and Interest Rate Swap miselling.
Still, this has not caused too much worry to the wider market, and the shares are down only 2% from their high last week. This suggests to me that there are some very strong holders of Barclays stock.
Barclays will announce 2012 results on 12 February. The bank is expected to report earning per share (EPS) of 35.7p, putting the shares on a 2012 P/E of just 8.2.
Tesco (LSE: TSCO) shares have rallied hard in 2013. So far this year, shares in the supermarket titan are up 7.2%. By comparison, the FTSE 100 index is up 6.6%.
Tesco's recent trading figures have inspired renewed confidence in the company. The shares are up 10.3% in the last 12 months and now stand at a high for the year.
Tesco shares trade on 11.2 times consensus forecasts for 2013, falling to 10.7 times the expected number for 2014. A dividend yield of 4.1% is expected for 2013, rising to 4.3% the year after.
Shares in Vodafone (LSE: VOD)(NASDAQ: VOD.US) have taken a step back recently on analyst downgrades. At the beginning of the year, the shares had rallied on speculation that the company might receive an offer for its stake in US mobile operator Verizon Wireless.
Vodafone continues to use excess cash to buy back its own shares in the market. As of this morning, Vodafone has spent a total of £360m on the market purchases. This is around one quarter of the total amount that it plans to spend.
Dividend investors will have welcomed the recent decline as an opportunity to top up. By my calculations, the 2013 dividend yield on Vodafone shares is 5.8%.
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> David owns shares in Vodafone but none of the other companies mentioned. The Motley Fool owns shares in Tesco and has recommended shares in Vodafone.