Royal Bank of Scotland Group plc (RBS), Barclays PLC (BARC): Ten FTSE 100 Shares to Soar in a Market Revival

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LONDON — You don’t need to be investing for long to understand that some shares are a wilder ride than others. There is a statistical measure for this: the “beta.” This encapsulates how volatile a share has been compared with the index.

Here are the FTSE 100’s 10 largest high-beta shares.

Company Price (pence) Beta Yield (forecast, %) P/E (forecast) Market Cap (million pound)
Lloyds Banking Group PLC
61 2.2 0.0 13.5 43,595
Barclays PLC
298 2.5 2.5 8.1 38,293
Royal Bank of Scotland Group plc (LSE:RBS)
316 2.6 0.0 14.4 35,430
Anglo American plc (LON:AAL)
1426 1.8 3.8 11.1 19,875
Legal & General Group Plc (LON:LGEN)
171 1.8 5.0 11.1 10,106
Antofagasta plc
904 1.8 2.7 13.1 8,912
ITV plc
137 1.8 2.4 13.4 5,379
302 2.3 2.6 11.3 4,933
The Weir Group PLC (LON:WEIR)
2162 1.7 1.9 14.2 4,607
Vedanta Resources plc
1212 2.7 3.1 10.0 3,230

I expect that each of the five shares below will continue exaggerating the market’s movements and produce big gains if the bull market resumes.

Barclays PLC (LON:BARC)

Barclays PLC (ADR) (NYSE:BCS)

After starting the year at 262 pence, Barclays PLC (LON:BARC) shares rose to a high of 333 pence when the FTSE 100 peaked in May. Since then, the shares have dropped back to 297 pence.

It is often argued that Barclays PLC (LON:BARC) shares are a geared play on the success of the market. Price movement so far this year would seem to bear this out. However, Barclays PLC (LON:BARC) could generate big returns for shareholders even in a lackluster market.

That is because, at less than 300 pence, Barclays PLC (LON:BARC) shares are very cheap. Barclays PLC (LON:BARC) is forecast to make 36.6 pence of EPS (earnings per share) in 2013. That puts the shares on a 2013 P/E of 8.1. The average FTSE 100 stock trades on a P/E of 13.6. Earnings and dividends are forecast to rise further this year and next.

Royal Bank of Scotland Group plc (LSE:RBS)

The market was shocked recently by the announcement of Royal Bank of Scotland Group plc (LSE:RBS) boss Stephen Hester’s planned departure. Before the news broke, the shares traded at 326 pence. Two days later, they closed at 315 pence.

Hester has been key to the bank’s rehabilitation. As a shareholder in Royal Bank of Scotland Group plc (LSE:RBS), I am very disappointed to be losing his talents. Now, Royal Bank of Scotland Group plc (LSE:RBS) needs to find another experienced bank boss that the market has confidence in. You don’t find those on Craigslist…

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