LONDON -- June was a relatively good month for the FTSE 100, as it regained some of its past fall. From a level of 5,321 at the end of May, it finished June 250 points ahead on 5,571 for a 4.7% gain.
Here we look at some of June's stock market stars. As usual with these monthly reviews, we're not necessarily interested in the biggest percentage gainers; we're trying to find companies that still seem a decent value and could build on June's gains in the months and years to come.
The reason is the general turnaround in sentiment toward the homebuilding sector, which has seemed undervalued to me for some time. Current forecasts for Persimmon suggest more than 20% earnings-per-share growth for the year to December 2012, with 16% next year.
The shares are on a forward price-to-earnings ratio of less than 12 for 2013, which doesn't appear stretching, so this could be just the start.
If you'd prefer others in the sector, Barratt Developments gained 16% in June to 140 pence, Bovis Homes rose 14% to 471 pence, and Redrow put on 11% to 121 pence.
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Home Retail, the owner of Homebase and Argos, also had a healthy June after releasing an upbeat interim statement on the 19th. It finished the month up 8% to 84 pence.
And although Marks & Spencer had a down month, falling 2% to 325 pence, Debenhams climbed 12% to 86.5 pence, so the recovery might be on -- and Dixons could be a big part of it.
After a prolonged stagnation, telecom provider TalkTalk jumped 38 pence to 191 pence during June for a whopping 25% gain.
TalkTalk got a strong boost in May after releasing good results, which allowed it to raise its dividend by 20% and announce a plan to increase it by at last 15% per year for the next two years, putting it alongside others, such as BT, that are targeting dividend growth.
TalkTalk's cheap broadband offering is also picking up customers as it aggressively competes with BT and Virgin Media.
Shares in Provident Financial
It's clearly a profitable business, and forecasts for the next two years are good. Estimates of EPS growth are modest, but there's a 6.25% dividend yield forecast for December this year, rising to 6.7% next year. Past growth aside, the divided alone could still make it a profitable investment.
If you had bought Rightmove
June growth was a bit more modest -- an 8.6% climb to 1,592 pence -- but still nice. And sentiment for the online estate agent is pretty positive, despite the shares being on a lofty forward P/E of 28 for this year, falling to 24 based on 2013 forecasts.
But it's clearly a geared play on the housing market, and when it gets moving again, as homebuilder progress seems to indicate, there could be a big boost to business for Rightmove, though it could still be a couple of years away.
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Alan does not own any shares mentioned in this article. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.