Should I buy the best-performing FTSE 100 stocks of 2021 (so far)?

These FTSE 100 stocks have made gains of up to 68% year-to-date. G A Chester discusses whether they’ve attractive qualities and valuations.

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.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Most FTSE 100 stocks have made decent progress so far in 2021. The blue-chip index is up 11%. However, some stocks have raced well ahead of the field, with gains of up to 68%.

As you’ll see, these outperformers listed below are a mixed bag of businesses. Do they have qualities and valuations that could make them particularly good investments for me? Let’s have a look.

The high-flying FTSE 100 stocks

This table shows the Footsie’s top five performers since the start of the year. For perspective, it also shows their longer-term returns:



Year to date (%)

5 years (%)


Sports betting and gaming



Ashtead Group

Industrial equipment rental



Royal Mail

Delivery services



St James’s Place

Wealth management




Commodities production and marketing



Lucrative convergence

I see a lot of growth potential in Entain. It’s a cutting-edge business with market-leading technology. And it’s positioned at the heart of what looks like being a lucrative convergence of media, entertainment and gaming. Growth is expected to really kick in next year.

Regulatory risk, in areas such as licencing and player protection, is something I need to be aware of. Nevertheless, with its shares at 1,910p, I’d be happy to buy this FTSE 100 stock on a 2022 price-to-earnings (P/E) ratio of 21 and prospective dividend yield of 2%.

Beneficiary of infrastructure spending

I like Ashtead’s simple business model, economies of scale and diverse customer base. I’ve written positively about it in the past, albeit when its shares were trading at a much lower level (1,950p) than today (5,614p).

At the current price, its 2022 P/E is above 30 and prospective dividend yield is below 1%. It’s set to benefit from post-pandemic infrastructure spending by governments, but for a company that serves largely cyclical industries, I think the P/E is quite demanding. If I owned the shares, I’d hold them at this level, but it would take a lower valuation to interest me in buying.

The other three FTSE 100 stocks

I’m less keen on the businesses of Royal Mail, St James’s Place and Glencore. Royal Mail’s UK letters business is unique, but also in structural decline. With this drag, and the parcels market being highly competitive, I’m not surprised City analysts see a future of low growth and pressure on margins.

Even on a single-digit P/E, at a share price of 490p, it’s not a stock for me. But I can see a prospective dividend yield of over 4% could interest income-focused investors.

I may be underestimating the ability of St James’s Place to continue extracting high fees from its wealthy clients. And the willingness of its clients to pay them. But as I’ve doubts about the long-term sustainability of its charges, a P/E of 29 and 3% dividend yield (at a 1,604p share price) don’t have great appeal for me. I think there are more attractive wealth managers for me to invest in.

Finally, I’ve never really got to grips with what I see as part-natural-resources producer, part-commodities-trading hedge fund Glencore. Certainly it’s a differentiated business, and a number of my Motley Fool colleagues are keen on the stock (P/E of 9.5 with a 4.5% dividend yield at a share price of 333p).

But whenever I look at the business, it goes back on what Warren Buffett’s partner Charlie Munger would call my ‘too hard’ pile.

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 assessed. Consider taking independent financial advice.

G A Chester has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.

More on Investing Articles

Young mixed-race woman jumping for joy in a park with confetti falling around her
Investing Articles

6.9% dividend yield! 2 cheap stocks to consider for a £1,380 passive income

Looking for a market-beating passive income? These FTSE 100 and FTSE 250 dividend stocks could provide a healthy second income…

Read more »

Mature black couple enjoying shopping together in UK high street
Investing Articles

Potentially 34% undervalued, should I be watching the boohoo share price?

The boohoo share price has seen a rocky few years, but with signs that the economy is improving, could this…

Read more »

Investing Articles

Is the Amazon share price primed for a drop?

The Amazon share price has been on a tear for the last year, but can this trend continue? Gordon Best…

Read more »

Photo of a man going through financial problems
Investing Articles

Down 15% in a week! What’s gone wrong with the National Grid share price?

The National Grid share price isn't supposed to crash but now it has. Harvey Jones is wondering whether to take…

Read more »

Group of young friends toasting each other with beers in a pub
Investing Articles

Taylor Wimpey just paid me £158.78. I’m aiming to turn that into a £100k yearly second income

Harvey Jones says small, regular dividend payments can turn a few pounds into a mighty second income, if he gives…

Read more »

A pastel colored growing graph with rising rocket.
Value Shares

These FTSE 250 shares are tipped to rise 14% to 18% in the next year!

Looking for the best FTSE 250 momentum shares to buy? Here are two that City analysts expect to soar in…

Read more »

Young mixed-race woman jumping for joy in a park with confetti falling around her
Investing Articles

Lloyds’ share price is up 20% in 3 months! How high can it go?

Lloyds’ share price has ripped higher recently. Here, Edward Sheldon provides his view on the level it could potentially climb…

Read more »

Investing Articles

Why the Rolls-Royce share price could continue to outperform

The Rolls-Royce share price keeps moving forward, but this Fool thinks it's still behind where it ought to be after…

Read more »