SHARE MARKET

Must buy 2 FTSE 100 shares in October


We are currently in a unique economic climate and are having trouble reading market movements. The risk of another market collapse on a large scale, panic selling is a real problem. As we move into October, I’m focusing on these two tested, solid FTSE 100 Shares with a history of positive financial performance and shareholder returns.

Retail dividend stock

Tesco (LSE: TSCO) has made a good run in the last six months. Its share price has risen 12% during this period and Moody’s will release its first half (H1) results for 2021-22 on October 20th. I think a favorable outcome could push up its share price in the next few months.

Tesco’s recent revenue growth looks very impressive to me. The net income of the supermarket chain has increased at a rate of 24% in the last five years. This is much higher than the industry average of 8.4%, which shows me an impressive presence in this sector. Analysts predict that the main earnings of the FTSE 100 could increase by 149% in 2021-22. In the first quarter of its current fiscal year alone, sales increased 9.3% compared to pre-epidemic 2019 figures.

Given the razor-thin margins of the supermarket sector, these basics seem very appealing to me. The company yielded a 3.9% dividend yield at 255p on its current share price, well ahead of the FTSE 100 average of 3.4%.

In fact, I think the company has an excellent history of shareholder returns. Tesco’s three-year median payout ratio is 53%. The UK’s largest grocer also announced a special dividend of ৫ 5 billion in February 2021 after selling Asian operations for .. 6 billion.

Although the grocer has the largest market share in the supermarket space, it faces stiff competition from the likes. Sciencebury And Morrisions. Also, the growing popularity of discount retailers like Lidl and Aldi could hurt future revenue. But, I am still confident that a strong financial report in October could significantly boost its share price, which is why I am watching Tesco’s shares closely in October.

FTSE 100 Insurers

I think so Aviva (LSE: AV) The stock looks extremely cheap at the moment. At 401p, Aviva is trading at a 9.1-fold profit-to-earnings (P / E) ratio, pointing to a highly devalued stock. Combined with an impressive 5% dividend yield, it looks like a great FTSE 100 value option to me.

Sustainable economic recovery can greatly benefit the insurance sector. Also, Aviva has been restructuring its business for the past 12 months to focus more on key markets such as the UK, Canada, Ireland and China. The insurer has sold non-core operations in Turkey and France, which could bring in £ 7.5bn. As a result, b 4bn shareholder payments were announced, starting with a buyback of 50 b50 million shares.

Analysts expect Aviva shares to reach 800p by 2024, which could significantly boost its current dividend yield. This is supported by an impressive H1 2021 where it has been shown that operating profit has increased by 17% to £ 725m.

Faces competition from company choices Legal and general And Wise. Also, the volatile economic situation and the risk of market catastrophe can strongly affect the financial sector. However, Aviva still has a place on my FTSE 100 stock list due to its renewed focus on key markets and a strong history of shareholder returns.

5 stocks to try to make wealth after 50

Coronavirus epidemic disrupts markets around the world …

And many big companies that are trading at ‘discount-bin’ prices may now be able to bargain for potential investors.

But whether you are a novice investor or an experienced professional, deciding which stock to add to your shopping list can be a risky prospect at such an unprecedented time.

Fortunately, The Motley Flower is here to help: We have five companies shortlisted by the UK’s chief investment officer and his analyst team that they believe have the potential for long-term growth despite a global lockdown.

You see, here in The Motley Flower we don’t believe that “over-trading” is the right path to financial freedom in retirement; Instead, we are in favor of purchasing and holding (for at least three to five years) 15 or more quality companies, led by a shareholder-centric management team.

That’s why we’re sharing the names of these five companies in a special investment report that you can download for free today. If you are 50 or older, we believe these stocks can be suitable for any diversified portfolio, and you can create a position in the top five right now.

Click here to claim a free copy of this special investment report!


Suraj Radhakrishnan has no position in any of the mentioned shares. Motley Flower UK is recommended by Morrison, Prudential and Tesco. The opinions expressed in the companies mentioned in this article may differ from those of the authors and therefore the official recommendations we make on our subscription services such as Share Advisors, Hidden Winners and Pro. Here at The Motley Flower we believe that considering a variety of insights makes us a better investor.





Source link

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button