3 Great Value FTSE 100 Shares: Royal Dutch Shell, J Sainsbury, and Old Mutual

LONDON -- Ranking every UK blue-chip using information such as price-to-earnings ratio, dividend yield and free cash flow, these three companies come out near the very top.

Royal Dutch Shell
Super-share Royal Dutch Shell (LSE: RDSB) (NYSE: RDS-B) trades close to a five-year high. However, there is still plenty of value in the shares.

Shell is forecast to grow its dividend for at least two more years. At today's price, the shares trade on a historic yield of 4.8%. That payout is expected to reach 5.2% in 2014.

By that time, Shell is expected to be making earnings per share (EPS) of 273p. That equates to a 2014 price-to-earnings (P/E) ratio of 8.5.

The average FTSE 100 share trades on a forward P/E of 13.8 times earnings and is expected to pay a 3.1% yield. Shell is clearly cheap.

J Sainsbury
J Sainsbury's (LSE: SBRY) recent results revealed an increase in sales but a small fall in pre-tax profits.

Chief executive Justin King is determined that Sainsbury's can secure growth away from food. Sainsbury's has announced a new ebook initiative and is spending ÂŁ250m to take full control of Sainsbury's Bank.

Analysts have forecast 4.5% EPS growth this year. That puts the shares on a 2014 P/E of 12.1.

As for income, Sainsbury's has been increasing shareholder payments every year since 1995. Analysts expect the payout to reach 17.2p for 2014, equivalent to a 4.6% yield.

Old Mutual
Only a rotten fund manager would fail to grow earnings in a bull market. In the last year, the FTSE 100 is up 20%. In that time, shares in Old Mutual (LSE: OML) have risen 30%.

Since the depth of the bear market in 2009, Old Mutual shareholders have enjoyed the recovery. Profits at the company have since returned to the level that they were before the credit crunch. Dividend forecasts for 2013 are four times greater than the 2009 payout.

The growth forecast for the next two years puts Old Mutual shares on a 2014 P/E of 10.0, with an expected yield of 4.2%.

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