Although many FTSE shares have been tearing upwards over the past few months, some of my favourites received a pummelling from the markets. However, I think the mood music is changing and these great stocks could be about to shine again.
I’d aim to put every one of these seven shares in my Stocks and Shares ISA for April and beyond.
Pharmaceuticals
Ever since AstraZeneca released its Covid-19 vaccine — and gave it to the world at cost price — the market battered the stock. They say no good turn goes unpunished and I reckon that’s the case here. But City analysts expect earnings to grow in the years ahead, so I’d buy for the ongoing growth story. However, the valuation is quite full and leaves little room for an earnings miss. It’s still possible for the downtrend to continue from here.
Online fashion clothing
Online fashion retailer Asos (LSE: ASC) is a clear industry leader I expect to go from strength to strength in the years ahead. But the valuation is high and immediate growth prospects don’t shoot the lights out. It’s possible the gap between valuation and growth could contract acting as a drag on the stock’s progress.
Boohoo (LSE: BOO) is another stalwart hoovering up once-proud bricks-and-mortar fashion clothing brands just like Asos has been. The firm has been under scrutiny because of alleged dodgy supply chains. However, earnings growth remains brisk. The valuation looks rich, but I think the quality of the underlying business justifies that. Nonetheless, the stock has been volatile. And the high rating could normalise downwards if earnings growth slows in the future. However, I’d buy the stock.
Fast-moving consumer goods
Soft drinks maker Britvic (LSE: BVIC) operates in a defensive, cash-generating sector and ticks many boxes for me. The valuation looks fair. However, the stock has essentially travelled sideways for seven years. If growth in earnings fails to pick up, I could endure another frustrating seven years from here. Nevertheless, I’m keen on the stock today.
Fast-moving consumer goods business Reckitt Benckiser operates in an attractive, defensive sector. City analysts expect a high single-digit earnings rebound ahead and that could arrest the slide in the share price. However, the valuation remains elevated. Maybe companies like this aren’t as valuable as I once believed. One possibility is valuation shrinkage could drag on share-price progress ahead. But I’d accept that risk and buy some of the shares now.
Other sectors
Information technology infrastructure services provider Computacenter has seen its business grow steadily for a number of years. The stock has done well too. But earnings growth has slowed to a trickle while the valuation remains elevated. I could be disappointed with this one if growth in earnings doesn’t pick up again soon. But I’m inclined to put my faith in the company and buy the stock.
Energy transmission company National Grid has been a steady dividend payer for years. But high borrowings and regulatory changes could yet sour the investment potential of the stock. Nevertheless, I still think the firm’s unique position in the nation’s energy infrastructure is attractive.
I’d be inclined to embrace the risks and buy all seven of these stocks for their potential in April and beyond.
