It looks as if a stock market crash is beginning to unfold around the world. I want to take advantage of this environment. I’ve been looking for shares to buy for my portfolio that are currently on sale. Here are three companies I’d buy today based on their valuation and long-term potential.
Stock market crash bargains
The first on my list is the Asia-focused insurance group Prudential (LSE: PRU). Shares in this company have fallen heavily as it’s highly exposed to Asia. There are concerns that the failure of the Chinese property group Evergrande could have a knock-on effect on the region’s economy. This may have an impact on the demand for Prudential’s services.
However, in the stock market crash, I’d buy this company because life insurance isn’t something consumers jump in and out of. It’s a long-term product. That suggests demand for Prudential’s services should remain robust in the long term.
To help strengthen its balance sheet, the group’s also looking to raise £2bn through a listing of its shares in Hong Kong. These are reasons why I think this is one of the best shares to buy now.
As we advance, some risks it may face include competition and higher interest rates, which could dent demand for its services.
Shares to buy for growth
I’d also buy Standard Chartered (LSE: STAN) for my portfolio for the same reasons outlined above. Shares in the emerging markets-focused bank are falling as investors are becoming concerned about its growth outlook.
Nevertheless, I believe emerging markets should continue to grow in the long run. That’s why I think this is one of the best shares to buy for growth in a stock market crash.
Standard’s strategic priorities are to expand its high net worth customer base and increase the size of its asset management business. It’s progressing on both of these fronts and should continue to do so as emerging economies recover from the pandemic. These are the reasons I’d buy the stock.
However, risks I’ll be focusing on include falling interest rates, which could reduce the amount of profit the group can make from its loans, and competition. Increased competition may push profit margins lower.
Finally, I’d buy mining giant Anglo American (LSE: AAL). Commodity prices have dived over the past few weeks, as supply’s risen to meet growing demand. This will undoubtedly impact industry profits, but commodity demand’s still expected to grow over the next few decades.
So, while it looks as if the company will experience some headwinds in the near term, over the next five or 10 years, I think prices will continue to rise, and miners like Anglo will reap the rewards.
Still, while I think this is one of the best shares to buy in the stock market crash, this company may not be suitable for all investors. Commodity prices could continue to fall, and the enterprise may face high environmental costs. These costs could impact profits, which would ultimately be bad news for investors.
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Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has recommended Prudential and Standard Chartered. 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.