LONDON -- This week, the retail clients of stockbroker TD Direct Investing had their eyes firmly on solid, high-yielding blue chips on sale at tempting prices.
Between the market's opening on Monday and today at noon, for instance, Vodafone (LSE: VOD.L ) was the single-most popular purchase by the broker's retail clients -- with its charms seemingly only growing as the week wore on. Down 4.7% on the week, Vodafone today offers investors one of the largest businesses in the FTSE 100, priced to go on a forecast price-to-earnings ratio of 10 and an eye-watering yield of 7.3% -- which management seems confident it can deliver. No wonder, perhaps, that this morning private buyers of the stock outnumbered private sellers by 12 to one.
Next up is BP (LSE: BP.L ) , still basking in the glow of its just-negotiated deal to sell its 50% share in TNK-BP to Russia's Rosneft, propelling the shares to be the third-most popular buy among TD Direct Investing's retail clients between the market's opening on Monday and today at noon.
While TNK-BP has delivered dividends and a sizable chunk of Russia's oil reserves to BP, the stake has also delivered ample headaches. At a stroke, the hope now is that those headaches are gone, with Rosneft buying BP's TNK-BP stake for $17.1 billion in cash and shares, and BP then using $4.8 billion of the cash to purchase a further 5.66% of Rosneft from the Russian government, taking its holding of Rosneft to 19.75%. On a forecast P/E of just seven, the hopefully less risky BP now offers a tempting forecast yield of 4.8%.
Last up: Tesco (LSE: TSCO.L ) , the seventh-most popular pick by the broker's private clients between the market's opening on Monday and today at noon. Heavily bought in the past few weeks following lackluster results which saw 30 pence lopped off the share price, Tesco is evidently still benefiting from last week's broker upgrade from UBS, which put a price of 370 pence on the share.
With a rating of just nine times forecast earnings and a 4.9% forecast yield, a broker upgrade and "buy" rating ought to be superfluous to investors with an eye for a blue-chip bargain. But, as they say, every little bit helps.
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