LONDON -- This week, the blue-chip buying retail clients of stockbroker TD Direct Investing once again had their eyes firmly on solid high-yielding blue chips on sale at tempting prices.
And first up is a share that seemingly has "bargain" written all over it: BG Group (LSE: BG.L ) , which was the broker's private clients' single-most popular "buy" between the market's opening on Monday and today at noon. How come? After a lackluster year, it seems that the market was spooked by third-quarter results that spoke of production growth cut to 3% for 2012, with no growth forecast at all for 2013.
The shares promptly plunged 17%, and remain 17% down over the week, as I write. That said, BG isn't a share for income investors -- its forecast yield is just 1.3%, on a market-average forecast price-to-earnings ratio of 11 -- but it does offer a cheap entry point into a business still regarded as growth stock.
Next up: Vodafone (LSE: VOD.L ) , a blue chip that very much is a share for the income investor, offering an eye-popping forecast yield that, at 7.5%, is more usually associated with battered insurers rather than a stock that -- last time I looked -- was the second-largest stock in the FTSE 100, with a market capitalization of 83 billion pounds.
Granted, a chunk of that yield is the "special" dividend from United States telco Verizon, but even without that, forecasts of a full‑year ordinary dividend of 9.6 pence place the share on a very creditable forecast yield of 5.6%.
No wonder, then, that the share comprised the third-most popular pick by TD Direct Investing's private clients between the market's opening on Monday and today at noon.
Thirdly, GlaxoSmithKline (LSE: GSK.L ) , which -- like fellow pharma AstraZeneca -- is a business battered by worries over patent expires and the consequent abrupt end to juicy patent-protected revenues. And Glaxo, as it happens, comprised the fourth-most popular pick by TD Direct Investing's private clients between the market's opening on Monday and today at noon.
Announcing a 6% increase in its quarterly dividend this week, Glaxo has certainly seen an element of off-patent damage to sales. But management remain confident of the strength of the product pipeline, and -- 3% down on the week -- Glaxo's price today of 1,362 pence seemingly offers an attractive entry point into a business that is still very much a global major, with strengths in prescription drugs as well as consumer healthcare brands. And on a forecast yield of 5.6% and a forecast P/E of 11, it's not difficult to see the attraction.
Finally, what did super-investors Neil Woodford and Warren Buffett buy this week? We can't tell you that, but we can tell you the names of the shares that they've been buying in the recent past -- and why they've been buying them.
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