3 FTSE Shares Hitting New Highs: Associated British Foods plc, Direct Line Insurance Group PLC and The Sage Group plc

A cutback in US economic stimulus had long been expected to lead to a bit of a slump in world stock markets. But now that it’s come to pass, the opposite has happened and the FTSE 100 (FTSEINDICES: ^FTSE) has gained 58 points to reach 6,551 today. But following on from six weeks of losses in a row, there’s seems to be little chance of a return to May’s 13-year record of 6,876 points any time soon.

Still, some shares are reaching pre-Christmas highs. Here are three from the FTSE indices:

Associated British Foods

Associated British Foods (LSE: ABF) had fallen back from its recent highs in the past few days, but it regained its ascendency earlier today to reach a new 52-week high of 2,403p. At the time of writing the price is back a little from that at 2,395p, but still up a very nice 50% over the past 12 months.

Primark has been the star of the company’s portfolio this year, helping reward shareholders with a 13% rise in earnings per share for the year to September.

But the share price looks a bit toppy to me now, with 2014 forecasts putting it on a prospective P/E of 23. 

Direct Line Insurance

Today saw a new high for Direct Line Insurance Group (LSE: DLG), of 238.5p, to put the shares on a relatively modest forward P/E of 11 for this year, falling to 10 for 2014.

That’s from a company predicted to be paying dividend yields of around 6% too, although the payout should only be covered about 1.5 times by earnings. Investors need to be mindful of what happened to Aviva and RSA Insurance when their high dividends proved to be too much of a stretch.


Our third for today is business software developer Sage Group (LSE: SGE), whose shares spiked up to a new record price of 396p today — that’s around a 33% rise over the past 12 months, and it’s nearly all come since October.

December’s full-year results provided a strong boost too, after the company lifted its dividend by 6% to 11.13p per share to yield 3.4%. Next year’s dividend should rise further, but the recent share price growth has brought 2014’s forecast payment down to a potential yield of 3.1%. 

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