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
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
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.
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.
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