Looking forward to next month, I have been asking myself what the best shares to buy for my portfolio may be. Here are two FTSE 100 shares I would consider buying in September.
Overlooked dividend raiser
One of the best shares to buy for my portfolio could be the conglomerate DCC (LSE: DCC). I often notice that this company seems to attract little attention, perhaps because it operates under a variety of brand names.
So, why would I consider adding it to my holdings?
First, I think the diversification of businesses helps to protect the company from the extremities of the business cycle. Secondly, many of its markets offer strong pricing power. For example, the company is a leading gas supplier in Europe. Customers who buy gas for their homes often have no alternative, which helps DCC to sustain revenues. Thirdly, I think the management has proven itself to be adept at continuing to build the business.
That enables the company to offer a 2.6% yield. The dividend has grown every year for more than a quarter of a century, although dividends are never guaranteed from any company.
Attractive entry point
The chairman bought around £215,000 worth of DCC shares in May – at a higher price than I could buy them in the market today. Since then, the company has issued an upbeat trading statement. The company told the market that in the first quarter it traded “very well”. DCC said that it expects the current year to be another one of strong operating profit growth. Based on that outlook, I consider these could be among the best shares to buy in coming weeks.
There are risks, though. Gas demand could fall as climate concerns drive shifts in energy sources. Any further lockdowns could hurt demand for the company’s healthcare division, if elective surgeries are postponed.
Why I think WPP could be among the best shares to buy
Another of the companies on my list of the best shares to buy for my portfolio is WPP (LSE: WPP). The advertising network has had a challenging few years. But I feel it is now starting to show clear signs of change in its fortunes.
The shares have risen 57% in the past year. That suggests a lot of anticipation of improved trading is already built into the WPP share price. But I see possible further progress ahead. The company continues to push into the digital space, yesterday announcing the acquisition of AI specialist Satalia. In its interim results last month, WPP said that first half revenue grew 9.8% compared to the equivalent period the prior year. Like for like growth of 16.1% was even stronger. With momentum returning and a business transformation underway, I think good news could continue to lift the WPP share price.
One risk is any downturn in customer demand, though. The advertising market has lately seen the strongest demand in four decades. If that falls, for example, because companies want to reduce their expenditure to boost profit margins, it could hurt WPP’s own revenue and profits.