LONDON -- Some of our top FTSE 100 shares had a very good April, with some impressive rises being seen. But which of them deserved their successes and are likely to carry on rewarding their shareholders into the future?
That's a harder question to answer, but I think the following five stand a good chance of going on to even better things:
Vodafone Group (LSE:VOD) was one of my picks last month, and it makes it again with a further gain of 9.6 pence (5.1%) to end April on 196 pence. But that in itself is not the main reason for my choice -- it is the possibility of Vodafone's tie-up with Verizon Communications providing something nice for shareholders going forward.
Whether there's a full merger of the two companies or a transfer of ownership of Vodafone's 45% stake in Verizon Wireless, something is pretty much certain to happen, and it will most likely be at a nice price for Vodafone.
A number of news items have boosted Lloyds Banking Group (LSE:LLOY) shares by 5.6 pence (11.5%) in April to 54.3 pence. First, we heard that Lloyds is to split off 632 branches and relaunch them as a newly floated TSB Bank -- that came after confirmation that the Co-operative had withdrawn from a planned deal to buy the branches. We also heard that the bank's Spanish retail operations are to be sold to Banco Sabadell.
But the major news is the return to big earnings, with Lloyds turing in a pre-tax profit of 2.04 billion pounds in its first quarter this year. That's a massive rise from the 280 million pounds recorded a year previously, though that quarter was hit by mis-selling costs.
A first-quarter surge in profits helped ARM Holdings (LSE:ARM) shares up 75 pence (8.1%) to end the month on 996 pence (and they're up a further 15 pence to 1,011 pence as I write these words). The chip designer saw earnings per share soar by 58%, after it saw a 35% rise in the number of ARM-based chips shipped, to 2.6 billion.
ARM's growth comes at a price, and that's a forward price-to-earnings (P/E) ratio of nearly 50, so there is clearly a lot more expected growth built in to today's share price. Of course, everyone knows that no company can keep growing forever, but for now at least, there's no sign of the wheels coming off for ARM.
Shares of Royal Dutch Shell (LSE:RDSB) picked up 68 pence (3.1%) to 2,253 pence, ahead of a first-quarter earnings update scheduled for tomorrow. Shell, the biggest company in the FTSE with a market capitalization of 141 billion pounds, looks remarkably cheap to me, sitting on a forward P/E of around 8.5 and with a dividend yield of more than 5% forecast.
There's no earnings growth expected over the next couple of years, but the dividend should be well covered and with demand for oil and gas extremely unlikely to be dropping off anytime soon, it must be one of the safest around too (barring any disasters, of course).
Some of our mining companies have been making a bit of a comeback, with shares of Eurasian Natural Resources (LSE:ENRC) rebounding by 28 pence (11.5%) to 274 pence. Others enjoyed rises too, though slightly disappointing economic figures from China kept fears alive that its economic growth is slowing.
But after a year that saw the Eurasian share price plunge by more than 50%, and with forecasts suggesting earnings growth for this year and next, Eurasian shares could be looking cheap now on a forward P/E of 8.5 (falling to under 7 for 2014 forecasts).
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