These FTSE 100 giants are on my best stocks to buy now list

Conor Coyle reckons these blue-chip UK companies could help grow his portfolio if he bought the shares today.

| 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.

Business development to success and FTSE 100 250 350 growth concept.

Image source: Getty Images

UK stocks appear to be booming in 2021 after a year that saw some of the steepest declines in the history of the index. While the FTSE 100 still trades some way off its pre-pandemic levels of around 7,600p, the UK’s biggest companies have been boosted by the rollout of the vaccine programme in recent months.

I still think there’s plenty of room for growth in FTSE 100 shares as the UK moves tentatively out of lockdown measures this year. Here are two UK firms I would add to my best stocks to buy now list.

Inflation Is Coming

Inflation is out of control, and people are running scared. But right now there’s one thing we believe Investors should avoid doing at all costs… and that’s doing nothing. That’s why we’ve put together a special report that uncovers 3 of our top UK and US share ideas to try and best hedge against inflation… and better still, we’re giving it away completely FREE today!

Click here to claim your copy now!

GSK

With a market capitalisation of more than £63bn, pharmaceuticals giant GlaxoSmithKline (LSE:GSK) is one of the biggest companies in the FTSE 100.

GSK’s share price has disappointed investors in recent years though, particularly over the last 12 months as the company’s wider vaccine sales suffered and it seemed to fall behind in developing a Covid vaccine. The shares are down 19% in the last year.

Despite this drop, I see an opportunity to buy GSK shares right now. The company is moving its Covid vaccine through the various trial phases, and demand for this is likely to be strong for years, even after the worst of the pandemic is over.

GSK also has one of the most attractive dividend yields on the index, currently sitting at 6.3%. This would provide me with a decent level of income before factoring in share price fluctuations. 

The group has also said it is to separate its biopharma and consumer healthcare businesses this year, which I think will help to streamline operations.

There are still potential downsides for GSK shares right now though. Its joint vaccine venture with Sanofi isn’t expected to be approved until the end of this year, and the company has also announced it will be changing its dividend structure in 2022, with payouts likely to fall. There’s still uncertainty about how the split in its businesses will also affect the share price.

But I see enough upside to buy GSK shares at the moment.

DGE

Times have been tough for Diageo (LSE:DGE) the maker of Guinness and Johnnie Walker. With bars up and down the country (and globally) shut, lockdown restrictions have led to a challenging environment for the hospitality industry.

Despite that, I have been impressed with how the company has been able to cope during the pandemic. The shares have actually grown 12% in the last 12 months, albeit the shares had already been falling by this point last year.

It’s important to note that Diageo is not just a UK-focused company. It operates in more than 180 countries, many of which haven’t been subject to the same strict lockdowns the UK has seen.

While profits were down by 8% compared to the previous year when the company recently reported its half-year results, I don’t think that’s too damaging considering the wholly different environment the company was operating in. While beer sales have been adversely affected, spirits sales have actually increased due to strong off-trade performance.

There are still headwinds for the Diageo share price though. Potential setbacks to vaccine rollouts in key markets such as the US and Europe could dampen the optimism surrounding the reopening of hospitality venues.

Despite the risk, I’d still add Diageo to my best stocks to buy now list.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies still trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

Click here to claim your free copy of this special investing report now!

conorcoyle owns shares of Diageo. The Motley Fool UK has recommended Diageo and GlaxoSmithKline. 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.

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 considered, so you should consider taking independent financial advice.

More on Investing Articles

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

How I’d apply the Warren Buffett method to buying shares

Learning from billionaire investor Warren Buffett, our writer explains his own approach to investing in shares for his portfolio.

Read more »

pensive bearded business man sitting on chair looking out of the window
Investing Articles

This dividend share yields under 1% — but I’d still buy it

This dividend share has a low yield. So why would our writer consider adding it to his income portfolio?

Read more »

Young lady working from home office during coronavirus pandemic.
Investing Articles

Looking for a good share to buy? Here’s how I do it

Here are two approaches our writer uses when hunting for a good share to buy for his portfolio to aim…

Read more »

man in shirt using computer and smiling while working in the office
Investing Articles

One cheap FTSE 100 share I’d buy for a new bull market

This FTSE 100 share is unloved and starting to look seriously cheap, says Roland Head.

Read more »

Young brown woman delighted with what she sees on her screen
Investing Articles

How I’d invest £500 in UK shares in 2022

Investing a small amount of capital in UK shares can result in high commission costs. Zaven Boyrazian explains how to…

Read more »

Black woman using loudspeaker to be heard
Investing Articles

2 battered FTSE dividend stocks to buy in July!

I'm still searching the FTSE 100 for the best bargains to buy. I think these two big dividend shares are…

Read more »

Woman pulling baffled face
Investing Articles

Can I trust Lloyds’ 6.1% dividend yield?

The Lloyds' share price has sunk in 2022, causing the bank's dividend yield to leap. But can I really trust…

Read more »

Young mixed-race woman looking out of the window with a look of consternation on her face
Investing Articles

3 top stocks to buy before the market rebounds

Edward Sheldon highlights three beaten-up stocks he'd buy before global stock markets stage a recovery from their 2022 declines.

Read more »