I have been looking for FTSE 100 shares to buy for my portfolio in August. As the world starts to move on from the coronavirus pandemic, I think some sectors will see more substantial growth than others.
And with that in mind, I’d buy the stocks below for my portfolio today.
FTSE 100 growth stock
A sector that’s seeing faster growth than almost any other is the construction industry. Governments around the world are spending huge sums on construction and infrastructure to try and stimulate their respective economies after the pandemic. Rising property prices have also ignited demand in the sector as developers rush to increase output.
I think one of the best stocks to buy to play this theme is equipment rental company Ashtead (LSE: AHT).
This group provides a vital service for the construction sector. It offers equipment rental, which many smaller companies rely on because they can’t afford to acquire the equipment outright.
Ashtead’s revenues are growing at a double-digit rate as growth in the construction sector accelerates. In its fiscal fourth quarter ended 30 April, rental revenue increased 15%, completing a “year of market outperformance across the business,” according to CEO Brendan Horgan.
As activity in the sector continues to grow, I reckon this trend should continue. That’s why I’d buy this FTSE 100 stock for my portfolio in August.
However, one thing I will need to keep an eye out for is a growth slowdown. The construction industry is highly cyclical. Ashtead’s sales are expanding today, but that won’t last forever. This is the most considerable risk hanging over the stock right now.
Economic recovery
The other FTSE 100 stock I’d also buy is banking group Barclays (LSE: BARC). I think this company’s latest set of results shows just how far the business has come since the beginning of the pandemic.
Barclays reported a pre-tax profit of £5bn on net income of £12bn in the first six months of 2021. This time last year, the lender’s profits were just £1.1bn. Higher trading income at the group’s investment banking division and a release of £742m from its Covid loan loss provision pot helped boost profits.
And as the economy continues to open up and return to growth, I reckon the company’s growth will only continue. As the lender builds on its progress over the next few quarters, I think the stock could begin to reflect its recovery. That’s why I’d buy shares in the FTSE 100 lender today.
That said, the group will undoubtedly face further challenges as we advance. These could include low-interest rates, which are impacting profitability, and additional regulation. The latter could increase costs and reduce profitability in certain business lines. These changes may hold back Barclays’ full recovery from the pandemic.
