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3 FTSE Shares You Should Have Bought Last Week: BAE Systems plc, G4S plc, and Balfour Beatty

The FTSE 100 (FTSEINDICES: ^FTSE) has continued this week in the same style of last week, with extra downward pressure from the US political stalemate and from fears of further crisis in Italy.

After losing 84 points on the week to end Friday on 6,513, the index of top UK stocks is down a further 56 points to 6,457 by midday on Monday. Weaker-than-expected factory data from China didn’t help either, depressing mining share prices.

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But some shares did well last week. Here are three from the FTSE indices that it might pay to keep an eye on:

BAE Systems

Engineering shares suffered badly during the financial crash — hit by falling government spending amongst other things. But BAE Systems (LSE: BA) (NASDAQOTH.BAESY.US), a constituent of the Fool’s Beginners’ Portfolio, has seen its shares surge strongly over the past 18 months. A 19p rise last week took the price up 4.2% to 467p, and it has now gained nearly 70% since last summer’s lows.

Last year saw a 15% fall in earnings per share (EPS), but at the time that did leave the shares on a P/E of under 9 and there was no debt on the books. Forecasts for this year indicate a modest recovery in EPS and there’s a 4.3% dividend yield expected. And with the recent price rise still leaving the shares on a P/E of only 11, I reckon BAE is still looking like a long-term bargain.


The recovery at G4S (LSE: GFS) got a bit more of a boost last week with a 4.6p rise to 254p. That’s only a modest 2%, but the price is now back up more than 20% from July’s low point. And sentiment seems to be swinging back in the firm’s direction since new chief executive Ashley Almanza took the helm.

The company is still refocusing and divesting some of its non-core assets, and there’s more work to be done, with a 20% EPS fall forecast this year. Debt is still a bit of an issue, too, but is this a recovery worth investing in? That’s for you to decide.

Balfour Beatty

Balfour Beatty (LSE: BBY) is looking like another interesting recovery prospect, with the shares having regained about a third of their value since early July. That includes last week’s 6.8p rise, which took the price up 2.4% to 284.5p.

News of a couple of contract wins during the week certainly helped, with the firm having landed an £87m deal for the commercial redevelopment of St James’s Market in London. And in a bigger deal, Balfour Beatty has been selected for the $200m (£125m) development of a second student accommodation project for The Texas A&M University System, in Texas.

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> Alan does not own any shares mentioned in this article.

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