The FTSE 100 (FTSEINDICES: ^FTSE) lost 65 points last week to end Friday on 6,583, despite positive economic news from China and the UK lifting spirits a little towards the end of the week. But today we have a glum mood again, with the index of top UK shares down 19 points to 6,564 approaching midday, after weak GDP figures from Japan. The world now awaits updates from Europe, due this week.
But which shares were bucking the trend last week? Here are three that rewarded shareholders nicely, and which may have more to offer:
Rio Tinto
You would have done well last week to buy any of the big miners, as news of an uptick in Chinese factory output gave the whole sector a boost — it was the Chinese slowdown that did the damage to commodities prices in the first place, and now we hear that year-on-year growth was up to 9.7% in July. So why Rio Tinto (LSE: RIO) (NYSE: RIO.US)? Well, I chose that one because it’s a Beginners’ Portfolio constituent, and I was especially pleased to see its share price gain 131p (4.3%) over the week to end Friday on 3,167p — the price is down a little today, to 3,150p.
Looking ahead, there’s a modest fall in earnings per share (EPS) forecast for the year to December 2013, but there’s a dividend yield of 3.7% expected and it should be well-covered. And a predicted return to growth in 2014 would drop the P/E to under 9.
FirstGroup
FirstGroup (LSE: FGP) has been through the wars, with its share price slumping over the past couple of years to a low of 92p in June. But are we seeing the signs of a return to growth? Things have been picking up since a first-quarter update on 17 July, which told us that the transport group’s £615m rights issues was complete and that recovery plans are on track.
Since then, the shares have risen 19.5p (21%) to 111.8p today, putting on 6.2p of that last week. The year to March 2014 will still bring a big fall in EPS — forecasts suggest 60% — but that would still leave the shares on a P/E of under 11, falling to just over 9 if 2015 forecasts prove accurate.
WH Smith
WH Smith (LSE: SMWH) shares have had a good 12 months, soaring around 45% to today’s 838p — and that was boosted by a 31p (3.9%) gain last week to close Friday on 832p, before a further upwards move today. Although the share prices was essentially flat from late-2009 until mid-2012, WH Smith was still growing its EPS all the way and paying a steadily-rising dividend.
Since the price recovery, some of that undervaluation has gone. But we’re still looking at a forecast P/E of under 12 for the year ending this month, and there’s a predicted 3.6% dividend yield that should be more than twice covered.
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> Alan does not own any shares mentioned in this article.
