2 FTSE 100 stocks I’d buy and hold for 10 years to achieve financial freedom

These FTSE 100 stocks have tripled investor money in the past decade. Manika Premsingh thinks this is a good starting point.

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All of us can have different ideas and goals about money. But almost everyone likes the idea of financial freedom. To not have to think about how I will fund the rest of my life at the current standard of living would be pure bliss. And the way to get to this bliss is through proper planning and investments. Of course even the best laid plans can go awfully awry, as the haunting example of Ukraine shows right now. But to the extent that I can plan my investments, I think it is a good idea to do so and leave the rest up to the fates! And my plan is at least partly to put my money into FTSE 100 stocks.

2 FTSE 100 stocks I like

There are a number of stocks in the index that can help me inch towards the objective of financial freedom. Like two that I intend to discuss here. The first of these is Bunzl (LSE: BNZL) and the second is Croda International (LSE: CRDA). If I had bought them 10 years ago, they would have more than tripled my money by now. 

Perhaps that is why they are highly coveted by investors. This is evident from the fact that they are priced at a premium, as seen from their market valuations. Bunzl has a price-to-earnings (P/E) ratio of 22 times. And that for Croda International is 30 times.The FTSE 100 P/E is 15 times right now as per Bloomberg numbers, which gives some perspective on the matter.

Healthy results

Still, I think it is entirely possible that these stocks could continue to reward investors over the long term. This is obvious after looking at their recent results. Consider Bunzl first, which is a global distributor of products from food packaging to personal protective equipment. Its adjusted numbers, which indicate the health of the underlying business, have been impacted because of ongoing Covid-19-related trends in 2021. But on a statutory basis, its earnings are improved from last year. And with economic recovery underway, I reckon it can continue to strengthen further. 

Croda International, which provides speciality chemicals to industries like personal care and life sciences, has seen a big jump in both revenue and earnings from 2021 compared to the year prior. In this case, the growth is also mirrored in adjusted numbers. This goes a long way in explaining why it is trading at a premium right now. Management is also optimistic about 2022. 

What I’d do

I am convinced for these reasons that the share prices for both can rise. In fact, I have long liked them. The question on my mind is when I should buy them. In the case of Croda International, a significant price correction has happened so far this year. I can wait and watch for the next few weeks to see if that will continue and if it does, it would be a good idea to buy it when its valuation is closer to the FTSE 100 P/E. In the case of Bunzl, I could wait for another earnings release just to be double sure that this is a good time to buy it, which I think will happen down the line in 2022. 

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 considered so you should consider taking independent financial advice.

Manika Premsingh has no position in any of the shares mentioned. The Motley Fool UK has recommended Bunzl and Croda International. 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.

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