4 Of The Best Value Stocks That Money Can Buy: BHP Billiton plc, Unilever plc, BTG plc And Drax Group Plc

These 4 stocks could be all set to deliver excellent returns: BHP Billiton plc (LON: BLT), Unilever plc (LON: ULVR), BTG plc (LON: BTG) and Drax Group Plc (LON: DRX)

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

BHP Billiton

This week’s production report from BHP Billiton (LSE: BLT) (NYSE: BBL.US) showed that the company is not slowing down its ambitious production targets. In fact, while politicians and its rivals are encouraging it to reduce the production of iron ore so as to provide some stability for the wider Australian economy, BHP Billiton is more focused on lowering its cost curve and also on successfully spinning off its non-core assets via the South32 project.

And, with BHP Billiton having one of the lowest cost bases in world mining, its future potential relative to its peers looks bright. Furthermore, its yield of 5.5% indicates that its shares offer excellent value for money at the present time.

Unilever

Unilever’s (LSE: ULVR) recent update showed that the economic challenges facing two of its key markets, China and Europe, may be subsiding. In fact, the company’s sales numbers were perhaps slightly better than anticipated, and this bodes well for the company’s long term future, since it stands to benefit greatly from the effects of Eurozone quantitative easing and the possibility of Chinese stimulus.

And, while Unilever trades on a price to earnings (P/E) ratio of 22.5, the consistency and robust nature of its earnings profile means that it remains a great value company to invest in at the present time.

BTG

While many of the larger pharmaceutical companies garner most of the headlines, with their potential for bids and takeovers, BTG (LSE: BTG) remains one of the most appealing health care companies listed in the UK. Certainly, its share price performance has been somewhat lacking in recent months, with it being down 6% since the turn of the year. However, this makes it an even more appealing buy at the present time.

For example, BTG trades on a price to earnings growth (PEG) ratio of just 0.5, which indicates that its shares are dirt cheap at the present time. Sure, it needs to deliver on its optimistic sales and profit forecasts, but with such a wide margin of safety it can afford to disappoint somewhat in the short run and still prove to be an excellent long term buy.

Drax

While fossil fuel power generation is set to become a thing of the past, coal fired power station, Drax (LSE: DRX), remains a great stock to own. That’s because it is in the process of becoming a predominantly biomass-fuelled power station, with its outgoing Chairman this week stating that the company is delivering an 86% reduction in carbon emissions through the use of biomass rather than coal.

And, while the issue of subsidies may cause investor sentiment to be held back over the short to medium term, Drax offers its investors a wide margin of safety. For example, it has a PEG ratio of just 1.1, which indicates that even though it is enduring a period of significant change, it remains a great value company that has significant upside potential.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Peter Stephens owns shares of BHP Billiton and Unilever. The Motley Fool UK has recommended BTG. The Motley Fool UK owns shares of Unilever. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Petrochemical engineer working at night with digital tablet inside oil and gas refinery plant
Investing Articles

Can the Centrica dividend keep on growing?

Christopher Ruane considers some positive factors that might see continued growth in the Centrica dividend -- as well as some…

Read more »

Smiling family of four enjoying breakfast at sunrise while camping
Investing Articles

How I’d turn my £12,000 of savings into passive income of £1,275 a month

This Fool is considering a strategy that he believes can help him achieve a stable passive income stream with a…

Read more »

Person holding magnifying glass over important document, reading the small print
Investing Articles

2 top FTSE 250 investment trusts trading at attractive discounts!

This pair of discounted FTSE 250 trusts appear to be on sale right now. Here's why I'd scoop up their…

Read more »

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.
Investing Articles

3 things that could push the Lloyds share price to 60p and beyond

The Lloyds share price has broken through 50p. Next step 60p? And then what? Here are some thoughts on what…

Read more »

Young female business analyst looking at a graph chart while working from home
Investing Articles

£1,000 in Rolls-Royce shares a year ago would be worth this much now

Rolls-Royce shares have posted one of the best stock market gains of the past 12 months. But what might the…

Read more »

Investing Articles

Are HSBC shares a FTSE bargain? Here’s what the charts say!

There are plenty of dirt-cheap FTSE 100 banking stocks for investors to choose from today. Our writer Royston Wild believes…

Read more »

Three signposts pointing in different directions, with 'Buy' 'Sell' and 'Hold' on
Investing Articles

Just released: Share Advisor’s latest ‘Hold’ recommendation [PREMIUM PICKS]

In our Share Advisor newsletter service, we provide buy, sell, and hold guidance for our universe of recommendations.

Read more »

Investing Articles

Investing £5 a day could help me build a second income of £329 a month!

This Fool explains how £5 a day, or one less takeaway coffee, could help her build a monthly second income…

Read more »