Tag Archives: PSON

FTSE 100 Index – 30 years old today

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The FTSE 100 Index was launched on 3 January 1984. The market capitalisation weighted FTSE 100 index replaced the price-weighted FT30 Index as the performance benchmark for most investors.

Price performance

The following chart shows the price performance of the FTSE 100 Index 1984-2013. A simple linear trendline has been added.

FTSE 100 Index [1984-2013] with trendlineThe index was launched in 1984 with a value of 1000 and closed 2013 at 6749. This is an increase of 575% over the 30 years, giving an annual growth of 6.57%.

The trendline calculates a value of 6695 for the end of 2013, which is just 54 points away from the actual value (less than 1% difference). As can be seen in the chart, the FTSE 100 Index is pretty much bang on its long-term (since 1984) trend.

Fascinating Footsie Facts

Number of companies in index 100
Market capitalisation, average (£m) 18,253
Market capitalisation, standard deviation 24,837
Share price, average (£) 12.93
Number of companies paying a dividend 96
Dividend yield, average (%) 2.92
Dividend yield, standard deviation 1.29
PE ratio, average 20.2
PE ratio, standard deviation 14.2
PEG, average 2.3
Turnover, average (£m) 14,674
Turnover growth last five years, average (%) 76.2
Turnover to capitalisation ratio, average 0.88
Number of companies making a profit 94
Profit, average (£m) 1,534
Profit growth last five years, average (%) 101.6
Profit / turnover, average (%) 16.9
Current ratio, average 1.29
Net cash, average (£m) 5838
Net cash, sum total (£m) 566,363
Price to net cash ratio, average 24.2
Net borrowings, average (£m) -1710
Net borrowings, sum total (£m) -165,902
Net gearing, average 1.00
Interest cover, average 70.0
ROCE, average (%) 50.1
ROCE, standard deviation 107.6

Original constituents

The following table shows the 30 original companies that are still in the Index today. (The 19 italicised companies have been in the index continuously since launch.)

Company TIDM
Associated British Foods
Aviva
British American Tobacco
Barclays
BAE Systems
BP
GlaxoSmithKline
GKN
Hammerson
Imperial Tobacco Group
Johnson Matthey
Land Securities Group
Legal & General Group
Lloyds Banking Group
Marks & Spencer Group
Pearson
Prudential
Reckitt Benckiser Group
Reed Elsevier
Rexam
Rio Tinto
RBS Group
RSA Insurance Group
J Sainsbury
Royal Dutch Shell
Smith & Nephew
Standard Chartered
Tesco
Unilever
Whitbread

Largest companies

The following table compares the market capitalisations of the top five largest companies in the index in 1984 and today.

Rank (1984) Capital (£m) Rank (2013) Capital (£m)
1 British Petroleum Co. 7401 Royal Dutch Shell 140,695
2 Shell Trans. & Trad. Co. 6365 HSBC Holdings 124,728
3 General Electric Co. 4915 Vodafone Group 114,860
4 Imperial Chemical Industries 3917 BP 90,984
5 Marks & Spencer 2829 GlaxoSmithKline 78,252

Oil is still there today, but industrial, chemical and retail stocks have been replaced by bank, telecom and pharmaceutical stocks.

In 1984 the total market capitalisation of the index was £100 billion; at the end of 2013 the market capitalisation had grown to £1,824 billion.

It’s interesting to note that Shell’s market cap. today is 40% larger than the whole FTSE 100 Index in 1984.

Other references

FTSE 100 at 30 article in the Telegraph  by Martin Vander Weyer.

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Pearson [PSON] – 44 years on the LSE

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On this day in 1969 Pearson listed on the LSE.

The following chart plots the average monthly out-performance of the shares over the FTSE 100 Index since 1988. For example, on average Pearson has out-performed the FTSE 100 by 1.9 percentage points in March.

Average monthly performance of Pearson [PSON] relative to the FTSE 100 Index (1988-2013)

Observations

  1. The strongest month for Pearson shares relative to the market has been March (the shares have out-performed the market in this month in 16 of the last 25 years).
  2. The weakest month for Pearson relative to the market has been June (the shares have only out-performed the market in this month in 8 of the past 25 years).

Pearson is in the FTSE 350 Media [NMX5550] sector.

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Media sector monthly seasonality analysis

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The 2013 edition of the Almanac looks at the historic monthly performance of the FTSE 350 sectors. Here we look at the Media sector.

The following chart plots the average out-performance of the FTSE 350 Media sector over the FTSE 100 Index by month since 1999. For example, since 1999 on average the Media sector has out-performed the FTSE 100 Index by 3.0 percentage points in January.

Observations:

  1. The strongest months have been January and November – the sector has under-performed the market only three times in November in the last 14 years.
  2. The weakest month has been September – the sector has out-performed the market only three times in September in the last 14 years.

The 13 stocks in the FTSE 350 Media sector [NMX5550] are-

Aegis Group [AGS] Pearson [PSON]
British Sky Broadcasting Group [BSY] Perform Group  [PER]
Euromoney Institutional Investor [ERM] Reed Elsevier [REL]
Informa [INF] Rightmove [RMV]
ITE Group [ITE] UBM [UBM]
ITV [ITV] WPP Group [WPP]
Moneysupermarket.com Group [MONY]
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