Today I am looking at three terrifically-priced FTSE 100 shares.
Taylor Wimpey
Taylor Wimpey is one of those blue-chip shares that has been swept lower during the course of the past fortnight (it is now dealing at levels not seen since last July). I reckon this is a brilliant buying opportunity.
There are few investments as safe as bricks and mortar, to paraphrase many an investor. Having a roof over one’s head is an essential requirement, after all, making the homebuilders (in my opinion) as defensively sound as the utilities. And a lack of available properties on the market means that demand for Taylor Wimpey’s newbuilds is as robust as ever, even if the domestic economy wavers.
City analysts agree with my viewpoint and are consequently forecasting earnings growth of 9% and 4% at Taylor Wimpey in 2018 and 2019 respectively, resulting in a mega-low forward P/E ratio of 8.7 times.
And chunky predicted dividends of 15.2p per share for this year and 15.5p for 2019—projections that yield 8.2% and 8.4%—add to the construction giant's lustre.
ITV
ITV is another big yielder that can be picked up for almost nothing today.
Falling advertising budgets have resulted in heavy profits pressure in recent times. And against this backdrop a 9% bottom-line reversal is predicted at ITV in 2017, the first fall in many a year if confirmed.
While the difficult macroeconomic backcloth in the U.K. is likely to hamper any significant recovery in ad sales in 2018, items like the FIFA World Cup are predicted to help the London broadcaster enjoy a fractional earnings recovery. And in 2019 the business, helped by the terrific progress of its ITV Studios production division, is predicted to record a 5% earnings uptick.
As a consequence the company sports a forward P/E multiple of just 10.4 times.
And about those dividends: the Downton Abbey and Coronation Street producer is expected to pay rewards of 9p per share in 2018 and 9.7p next year. These figures yield 5.6% and 6% respectively.
International Consolidated Airlines Group
Underpinned by predictions of further chunky earnings growth, dividends are also expected to keep flying higher at British Airways and Iberia owner IAG.
In 2018, helped by an anticipated 7% profits uplift, the full-year payout is expected to swell to 29 euro cents per share, meaning an 4.3% yield.
And next year the dividend is expected to rise to 31 cents, supported by an expected 9% earnings improvement. The yield for 2019 consequently stands at 4.6%.
The transatlantic route continues to be a happy hunting ground for IAG and will continue to be so. But it is the low-cost segment which really offers plenty for investors to get excited about -- adding to the acquisitions of carriers Vueling and Aer Lingus in recent years, it launched its own budget carrier, Level, traversing Europe and North and South America in 2017. And IAG is expanding aggressively across its brands to latch onto the bright outlook for the cut-price carriers.
In light of these factors, I reckon a prospective P/E multiple of 6.3 times makes IAG one of the steals of the century.
