Considering the recent market turbulence, I’ve been searching the FTSE 100 for stocks to buy. I think the best shares to buy now are blue-chips with an uncertain outlook, which may put some investors off from owning them. However, I believe these investments could offer significant opportunities for long-term investors such as myself.
And with that in mind, here are the FTSE 100 stocks I’d buy for my portfolio today.
FTSE 100 income and growth
The first on my list is pharmaceutical group GlaxoSmithKline. This is a company investors love to hate, and I can see why. It’s an income champion and currently supports a dividend yield of 5.8%. However, profits have barely budged over the past five years, and that’s concerning.
Still, as an income investment, I think the stock looks attractive. That’s why it sits on my list of the best shares to buy now. It’s also trading at a price-to-earnings (P/E) ratio of around 12, which looks cheap to me.
Some risks the company may face include rising costs and competition in the pharmaceutical sector. Both of these factors could hurt growth.
I’d also buy blue-chip banking giant HSBC. Investors have been selling this stock recently due to its exposure to China, but that’s precisely why I’d buy it. I think this is one of the best shares to buy now because of its exposure to China.
China has the potential to become the world’s largest economy in the next few years. I think one of the best ways to invest in this growth is through a blue-chip like HSBC, although there are risks. Chinese companies and the government have a lot of debt, and the economy could always go into reverse.
I’d buy the stock for its 2.8% dividend yield and growth potential, despite these risks.
Best shares to buy now for the recovery
As well as the companies outlined above, I’d also buy fellow FTSE 100 catering group Compass for my portfolio. As the pandemic forced large events to close last year, Compass’s revenues collapsed. But now it’s now on the recovery trail.
It could take some time for the group to return to 2019 levels of growth but, as the world’s largest catering organisation, it has significant economies of scale and competitive advantages that will help in its recovery.
I’d buy the stock despite the risk that another global economic shutdown could derail its recovery.
The final company on my list of the best shares to buy now is Vodafone. With a dividend yield of 6.8%, at the time of writing, this is an FTSE 100 income champion.
As the world becomes increasingly reliant on data, I think the company will play an essential part in the digital economy. Its global footprint could be invaluable to gain a competitive edge over the rest of the market. That’s why I would buy the stock today.
Some challenges it may face include competition and rising levels of debt on the balance sheet.
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Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has recommended Compass Group, GlaxoSmithKline, and HSBC Holdings. 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.