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10 FTSE 100 Shares Trading Near 52-Week Highs

David O’Hara
February 4, 2013

LONDON -- Since inception in 1985, the FTSE 100 has delivered an average annual return of 6.9% a year. So far in 2013, the index is up 7.6%. Blue chip investors have made a year's worth of returns in just one month.

I found 46 FTSE 100 shares trading within 3% of their highest in a year. You may think that that this means that valuations are stretched and we are due some large falls. Personally, I think that we are at the start of a new bull market and that the index will finish the year even higher.

Of those 46 companies, here are the 10 largest.

Name Price (pence) P/E (2013, forecast) Yield (%, 2013 forecast) Market cap (million pounds)
HSBC Holdings (LSE: HSBA) 720 11.1 4.4 132,436
BHP Billiton 2,215 13.1 3.4 117,889
Unilever (LSE: ULVR) 2,603 18.7 3.2 73,736
SABMiller 3,158 20.7 2.1 50,368
Diageo (LSE: DGE) 1,906 18.6 2.5 47,822
Standard Chartered (LSE: STAN) 1,688 11.3 3.4 40,698
Barclays 300 8.0 2.4 36,723
Reckitt Benckiser 4,233 16.8 3.1 30,472
Tesco (LSE: TSCO) 361 11.3 4.1 28,996
Prudential 965 12.5 3.0 24,673

Data from Stockopedia.

Five shares stood out in particular.

HSBC is not like Barclays, Lloyds and Royal Bank of Scotland. HSBC is bigger. It is less reliant on the U.K. It continued to pay shareholder dividends throughout the worst of the financial crisis.

Although HSBC did approach shareholders for more capital in 2009, it was never thought to be in real danger.

Shares in HSBC are now at their highest since January 2010. Despite this rise, the shares remain inexpensive.

HSBC is expected to report an 11% rise in earnings per share (EPS) in 2013. The dividend is expected to rise a similar amount in the year.

I expect that HSBC will announce its results for 2012 in the final week of February.

Tesco was probably the most-discussed share of 2012. The supermarket started the year in the worst possible way by issuing a profit warning. This led to a share price fall of 20%.

Since then, Tesco has been winning back investors' confidence. Three weeks ago, Tesco announced improved Christmas trading. New management has been put in charge of the company's key U.K. operations. The company has also raised the possibility that its troublesome U.S. operation "Fresh and Easy" will be disposed of.

Tesco's progress has increased the probability that the company will pay a bigger dividend for the year. If Tesco confirms this with its 2013 finals in April, it will be the 28th year in succession that its shareholder dividend has risen.

Standard Chartered
Standard Chartered was one