3 Footsie winners you should have bought since Brexit

These three shares have climbed since the EU referendum vote.

| 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.

Well, what a month that was! July 2016 will surely go down as one of the most exciting months in recent stock market history. Today I’m going to have a look at three shares that have made it big since the EU referendum.

All that glitters

Shares in Fresnillo (LSE: FRES) soared by 56% from the vote to the end of July, closing at 1,931p. An upbeat production report a few days before the decision didn’t do any harm, but the real driver for the world’s largest primary producer of silver and Mexico’s second largest gold producer is the rising price of the metals — silver and gold have both spiked since the eventful day.

5 Stocks For Trying To Build Wealth After 50

One notable billionaire made 99% of his current wealth after his 50th birthday. And here at The Motley Fool, we believe it is NEVER too late to start trying to build your fortune in the stock market. Our expert Motley Fool analyst team have shortlisted 5 companies that they believe could be a great fit for investors aged 50+ trying to build long-term, diversified portfolios.

Click here to claim your free copy now!

I think chasing the prices of gold and silver up and down is a mug’s game, myself. And though there’s a good argument that these prices will remain high while there’s so much political and economic uncertainty, I see it as a poor approach to long-term investment.

After the rise, Fresnillo shares are now valued at a massive 60 times forecast earnings, dropping only to 40 based on a predicted 50% rise in EPS in 2017 — and dividends of only around 1% are barely worth talking about. There’s a lot more profit growth built into that kind of valuation, and it will take considerable further gold and silver price rises to justify it. I see that as gambling, not investing, and it’s a no from me.

Mining recovery

Glencore (LSE: GLEN) looks like a more rational long-term investment. And though we haven’t seen any sustained recovery in metals prices yet, Glencore has been cutting costs, and has disposed of assets and used the proceeds to reduce its massive debt hole.

That’s led to a 38% rise in the share price since 27 June, to a month-end 187p — a 162% rise from February’s low. But has the recovery been a  bit too enthusiastic or is there more to come? With the shares on a forward P/E of 38, the climb might look a bit overdone. But that would fall to 23 in 2017 based on the 60% EPS rise predicted for that year, and we’d be looking at a PEG ratio of only 0.4.

That’s typically considered an attractive growth indication, though it really doesn’t mean much unless that growth is going to be sustained. But though I do think we’re likely to see short-term volatility in the share price, Glencore should be a solid long-term investment.

A quick takeover

One of the biggest stories of the month was the recommended takeover approach from Japan’s SoftBank for chip designer ARM Holdings (LSE: ARM), which gave shareholders an overnight profit of 41% and took the shares up 64% since EU referendum day. While the fall in the value of sterling following the vote definitely made a lot of UK companies look attractive as takeover targets, the speed of this one was surprising — though I’ve been saying I think ARM shares have been undervalued for quite some time.

The bid of 1,700p per share represented a premium of 43% on the previous closing price, and today the shares stand at 1,672p — there’s still a tiny bit of uncertainty. A takeover at a P/E of 46 looks superficially attractive, but I think shareholders are selling too cheaply — and I’ll be sad to see this British success disappear from the FTSE.

Is this little-known company the next ‘Monster’ IPO?

Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead.

Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025.

The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential.

But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving.

Click here to see how you can get a copy of this report for yourself today

Alan Oscroft has no position in any shares mentioned. The Motley Fool UK has recommended ARM Holdings. 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

Thoughtful anxious asian business woman looking away thinking solving problem
Investing Articles

3 UK shares to buy in a stock market crash

Inflation and rising interest rates have our author on the lookout for a stock market crash. Here’s what he’s looking…

Read more »

Futuristic front of NIO car in Norwegian showroom
Investing Articles

Down over 50%, is NIO stock the best EV pick right now?

NIO stock has dipped over 50% in the past year. Does this create the perfect opportunity to buy or are…

Read more »

Buffett at the BRK AGM
Investing Articles

3 Warren Buffett techniques to build my wealth

Our writer shares a trio of Warren Buffett investing habits he hopes can help him build his own wealth.

Read more »

happy senior couple using a laptop in their living room to look at their financial budgets
Investing Articles

Aviva shares are in demand. Should I buy too?

Hargreaves Lansdown investors were piling into Aviva shares last week. This Fool is asking whether he should join the queue.

Read more »

A pastel colored growing graph with rising rocket.
Investing Articles

3 reasons why I think the IAG share price could rally this year

Jon Smith writes about how improving risk sentiment could help the IAG share price this year, but not without risks…

Read more »

Passive and Active: text from letters of the wooden alphabet on a green chalk board
Investing Articles

A passive income stock I’ve bought to supercharge my wealth!

I think this UK dividend stock is one of the best to buy for healthy long-term passive income. Here's why…

Read more »

British Pennies on a Pound Note
Investing Articles

3 hot penny stocks I’m buying in June!

With their exciting growth potential, penny stocks can be great investments. I've found three to buy next month based on…

Read more »

Passive income text with pin graph chart on business table
Investing Articles

2 green dividend shares I’d buy with £500

Jon Smith explains two dividend shares with a focus on renewable energy that have caught his eye at the moment.

Read more »