Why ITV plc, Galliford Try plc, Greggs plc, NEXT plc And Rightmove Plc Are Soaring
When is the FTSE 100 finally going to break through the 7,000 barrier? It's impossible to tell, but there are plenty of shares in the various indices reaching for the sky:
Broadcaster ITV (LSE:ITV) is up 25% over the past 12 months to 247p, and 375% over five years. As telecoms technology becomes increasingly indistinguishable between providers, content is the key these days, and that's helped ITV to more than double its EPS between 2010 and 2014, with two more years of growth forecast.
ITV's dividend has gone from nothing in 2010 to 4.7p last year, with 5.6p and 6.7p on the cards for this year and next. Yields are only between 2% and 3%, but the annual rate of increase is in double digits and way outstripping inflation.
A spurt since the start of 2015 has helped Galliford Try (LSE:GFRD) shares to a 15% rise in 12 months, to 1,496p. A strong resurgence in the housebuilding and construction business lies behind it, with the company reporting a 35% rise in revenue at the halfway stage to December, with the interim dividend boosted 47%.
With P/E ratios of 13.8 and 11.8 and dividend yields of 4.2% and 5.2% forecast for this year and next, there should be plenty more to come.
Baker Greggs (LSE:GRG) has stormed out of its recent slump of late, with a surge since September's update taking the price up 82%. Full-year results released on 4 March reinforced the comeback, revealing a 5.5% rise in total sales with a 4.5% like-for-like rise. Pre-tax profit excluding exceptionals soared by 41% and the dividend was lifted by 12.8%.
We're looking at maybe a slightly toppy P/E of 21 going forward with dividend yields at a modest 2.3%, but that could still turn out to be decent value if we're on for a multi-year growth period now.
What can you say about NEXT (LSE:NXT)? NEXT just gets it right, year after year, and in its December trading update told of a 7.7% rise in total brand sales. That includes a 12.9% rise in NEXT Directory sales, which is the kind of growth that online-only retailers would be happy with.
We've had five solid years of earnings growth, with more expected for the year just ended in January and again for this year and next. Quality companies command higher valuations, and NEXT's P/E of 17 based on this year's forecast looks justified.
The housing market is recovering nicely, and Rightmove (LSE:RMV) has pulled out of a weak 2014 and is climbing again -- up 14% over 12 months to 2,993p. But Rightmove never really suffered and its online market dominance has helped it to annual EPS growth of between 23% and 34% from 2010 to 2014, with 10% and 13% forecast for this year and next.
Dividends are only just getting off the ground with a forecast yield of 1.3%, and with a P/E of over 27 we're clearly looking at growth pricing -- but it's very much a growth market!
Alan Oscroft has no position in any shares mentioned. The Motley Fool UK has recommended Rightmove. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.