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J Sainsbury plc (SBRY), ASOS plc (ASC), Halma plc (HLMA): 3 FTSE Shares for the Week Ahead

LONDON — We’re in a bit of a summer lull for company news at the moment, and what results we do have coming in are mainly from very small-cap companies. It won’t really be until mid-July before we enter the next busy period, but we do still have some important news coming our way over the next few weeks. Here’s a quick look at three things to keep our eyes peeled for next week:

J Sainsbury plc (LON:SBRY)
We’ll have a first-quarter update from J Sainsbury plc (LON:SBRY) on Wednesday, and hopes are high for this year. The U.K.’s second biggest supermarket posted nice full-year results for the year to March 2013 in May, revealing a 4.6% rise in sales, with underlying pre-tax profit up 6.2%. Underlying earnings per share rose 9%, to 30.7 pence, enabling a full-year dividend of 16.7 pence per share — and that provided a yield of 4.6%.

Forecasts for this year paint a similar picture, with a 6% rise in earnings per share predicted. There’s also a 4.7% rise in the dividend to about 17.5 pence penciled in, which should be well covered, and it would provide a similar 4.6% yield on the current price.

And that price? Well, it’s slipped a bit over the past couple of weeks along with the FTSE in general, but at 363 pence, it’s still up 25% over the past 12 months, and is ahead of the index.

Wednesday will also bring us a third-quarter update from online fashion pioneer ASOS plc (LON:ASC). So far this year, the shares have had a great run, gaining around 130%, to 3,854 pence — and since the start of 2009, they’ve 15-bagged. Of course, after such an impressive price rise, the shares are not going to be on a low P/E. Based on forecasts for the year to August 2013, in fact, they’re on multiple of 80!

Such a high valuation clearly has a lot of future growth built into it, and we’d need earnings per share to multiply nearly sixfold to get the P/E down to the FTSE average of 14; so is that reasonable?

Well, forecasts for the current year suggest earnings will climb by 62% and, at the halfway stage to 28 February, the company recorded a 22% rise. We’ll certainly be needing a good second half.

Halma plc (LON:HLMA)
On Thursday, it will be time for full-year results from safety specialist Halma plc (LON:HLMA), and they should be good. The firm’s most recent trading update on 25 April told us that order intake for the fourth quarter was on track, and that profits should be in line with market expectations.

Those expectations suggest an 8% rise in earnings per share, putting the 501 pence shares on a P/E of 19. That’s a little above the FTSE average, but this is a company that has been regularly growing its earnings and increasing its dividends. There’s a dividend yield of 2% forecast for the full year, which looks a bit low — but the share price has climbed nearly 30% over the past 12 months.

Finally, dividends can add nicely to your investment returns — they can be spent or reinvested according to your needs. Whether investing for income or growth, good old cash is always welcome.

The article 3 FTSE Shares for the Week Ahead originally appeared on

Alan Oscroft has no position in any stocks mentioned. The Motley Fool recommends Halma.

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