For investors seeking to build wealth, in my view, there’s nothing better than FTSE 100 stocks.
The UK-leading index has put together a strong performance year to date. I think April could be a good opportunity to consider these stocks.
BP
Shares in energy giant BP (LSE: BP) are down 5.6% over the last 12 months. However, they’ve regained life in 2024, climbing 7.7%.
I think at their current price they offer great value. They trade on just 7.4 times earnings, a good amount less than the Footsie average of 11.
Tensions in the Middle East have helped drive oil prices up. But if the conflict eases, as we all hope, we could see prices come down.
Nevertheless, it’s expected global demand for oil will rise this year. China’s crude oil imports in March were the highest they’ve been since June 2020. As the world’s largest importer, a Chinese recovery will without a doubt provide markets with a boost.
The business will face pressure as the charge for net zero ensues. But with it seeming likely that the 2050 target will be pushed back, fossil fuels won’t be going away any time soon.
There’s also the income angle, with the stock yielding 4.4%. In the first half of this year, it intends to buy back $3.5bn of shares. BP is targeting that to rise as high as $14bn by 2025.
As a shareholder, those are the sorts of initiatives I like to see. I think investors should strongly consider getting in on the action too.
Tesco
I also think supermarket titan Tesco (LSE: TSCO) is worth taking a closer look at. Unlike BP, it has had a slow start to the year, falling by 1.2%. The industry leader is still up 8.2% over the last 12 months.
The stock is trading at 12.1 times forward earnings, which in my opinion is good value. That figure is forecast to fall to 11.2 by 2026.
Tesco has a strong grip over the industry with more than a 27% share of the market. The closest to that is Sainsbury’s with around 15%. Despite the cost-of-living crisis, Tesco actually managed to grow its market share in the four weeks to Christmas, which is mighty impressive.
Of course, rival budget supermarkets such as Aldi and Lidl are a threat. They’ve grown in popularity in recent years. Yet its sheer size gives Tesco an edge. It has strong brand recognition and a large, loyal customer base. It further allows it to benefit from economies of scale.
With a share price of 289.5p, its yield clocks in at 3.8%. What’s more, by the end of April the business would have bought back a cumulative £1.8bn worth of shares since October 2021.
Tesco bumped its full-year guidance in its half-year results. It then upped it again in its third-quarter update earlier this year.
With its results scheduled for release on 10 April, I’ll be watching closely. Analysts expect revenue to come in at £68.84bn, 4.7% higher than last year. Earnings per share is forecasted to rise 9.2% year on year to 23.86p per share.
Should it produce these numbers, that could provide its share price with some strong momentum going forward.
The post 2 of the finest FTSE 100 value stocks to consider buying in April appeared first on The Motley Fool UK.
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Charlie Keough has positions in Bp P.l.c. The Motley Fool UK has recommended J Sainsbury Plc and Tesco Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
