Vodafone Group Plc (ADR) (VOD), British American Tobacco plc (BATS), BT Group plc (ADR) (BT): 5 Shares Trading Near 52-Week Highs

Page 1 of 2

LONDON — The bull market of 2013 has pushed a lot of shares up into new territory. Here are the five largest companies trading within 3% of their high for the year.

Vodafone Group Plc (ADR) (VOD)Vodafone Group Plc (ADR) (NASDAQ:VOD)
Shares in Vodafone Group Plc (ADR) (NASDAQ:VOD) are up 25.5% in 2013. Just as they are near a high today, at the start of the year, they traded at a two-year low.

Vodafone Group Plc (ADR) (NASDAQ:VOD) shares have risen amid increasing speculation that they will receive a bid for their 45% share in U.S. mobile firm Verizon Wireless. Its partner in the joint venture, Verizon Communications Inc. (NYSE:VZ), is currently exploring whether it could buy out Vodafone Group Plc (ADR) (NASDAQ:VOD). A huge amount of posturing is taking place, the latest being the suggestion that Verizon Communications Inc. (NYSE:VZ) will prevent the joint venture from paying dividends to Vodafone Group Plc (ADR) (NASDAQ:VOD). That seems unlikely, as Verizon Communications Inc. (NYSE:VZ) needs such payments to enable it to pay its own shareholders a dividend.

I will ignore the speculation and continue to hold Vodafone Group Plc (ADR) (NASDAQ:VOD) for the dividend income.

British American Tobacco plc (LON:BATS)
The recent trading update from British American Tobacco plc (LON:BATS) assured the market on its progress in 2013. It also assured me: I am shorting the shares and am more convinced than ever that BATS (LSE:BATS) is hugely overpriced.

BATS (LSE:BATS) shares today trade at 17.5 times last year’s results. The average FTSE 100 company trades on 16.5 times trailing earnings. 11.4% earnings per share (EPS) growth is forecast at BATS, vs. 9.5% for the FTSE 100 on average. So, why am I short?

Because I cannot think of a single blue-chip company whose long-term future looks worse than British American Tobacco plc (LON:BATS)’s.

From its last trading statement, tobacco sales to Asia-Pacific were up 6.7%. Sales to Americas: down 15.6%. Europe: down 10.3%. EMEA: down 1.8%. Overall tobacco sales were down 3.6%. BATS is on the verge of going ex-growth.

BT Group plc (ADR) (NYSE:BT)
Shares in BT Group plc (ADR) (NYSE:BT) have increased 29.2% in the last year. That’s the kind of rise that a share can deliver when investors change their minds about a company’s prospects. Today, BT Group plc (ADR) (NYSE:BT) trades on 11.5 times the consensus of analyst forecasts. That’s still a big discount to most FTSE 100 shares and a long way below the P/E of 14.8 that rival shares in British Sky Broadcasting Group plc (LON:BSY) shares trade at.

Page 1 of 2