Despite world stock markets experiencing high volatility in May, UK shares held up well. Over the past month, the FTSE 100 index actually added almost 0.9%. Meanwhile, the US S&P 500 index crept up by under 0.1% and the tech-heavy Nasdaq Composite dipped by 3.2%.
Furthermore, over the past 12 months, the FTSE 100 has climbed by 7.7%, versus a 1% fall for the S&P 500 and an 11.7% slump for the Nasdaq Composite. All figures exclude cash dividends.
The FTSE 100’s winners and losers over one month
Although the FTSE 100 rose over the past 30 days, not all of its members followed suit. Interestingly, 50 Footsie stocks are down, while 50 are up. Among the 50 winners, gains range from 0.5% to 20.8%. The average gain among these risers is 6.2%.
Meanwhile, at the other end of the scale lie those FTSE 100 losers. Declines among these range from 0.9% to a brutal 24.2%. The average decline is 7%. And it’s among the worst of these slumpers that I’ve been looking for value today.
The Footsie’s three biggest losers over one month
For the record, these three FTSE 100 shares have seen the biggest price falls over the past 30 days:
| Company | Segro | Aviva | Harbour Energy |
| Sector | Commercial property | Insurance and investment | Oil & gas production |
| Share price | 1,129p | 434.7p | 378.9p |
| One-month loss | -17.1% | -23.4% | -24.2% |
| 12-month change | 5.9% | -20.7% | -10.5% |
| Market value | £13.4bn | £12.1bn | £3.54bn |
| Price/earnings ratio | 3.3 | 51.8 | 41.7 |
| Earnings yield | 30.4% | 1.9% | 2.4% |
| Dividend yield | 2.2% | 6.7% | 2.2% |
| Dividend cover | 13.9 | 0.3 | 1.1 |
As you can see, losses among these FTSE 100 fallers range from over 17% at Segro (formerly Slough Estates) to over 24% at Harbour Energy. Over one year, share-price movements range from a near-6% gain at Segro to a near-21% loss at giant insurer Aviva. For these three Footsie stocks, May and not April is the cruellest month (as per T S Eliot).
Which of these Footsie fallers would I buy today?
Right now, I can see plenty of reasons not to buy certain shares. Red-hot inflation and supply-chain constraints are pushing up consumer prices. Interest rates are on the rise across the globe. Economic growth is slowing, notably in China due to city-wide lockdowns. War still rages between Ukraine and Russia. And the Covid-19 pandemic isn’t over yet. Nevertheless, I still see plenty of cheap shares in the FTSE 100 today.
Of the three FTSE 100 fallers above, the one share I would buy and hold now is Aviva. That’s because as a veteran value investor, I’m drawn to its market-beating dividend yield of over 6.7% a year. That’s a sizeable premium over the wider FTSE 100’s cash yield of under 4% a year.
That said, share dividends are not guaranteed, so they can be cut or cancelled at any time. Indeed, Aviva reduced its cash payout in 2002, 2009, 2012 and 2020. And on a backward-looking basis, the dividend isn’t covered by earnings. But its earnings are forecast to rebound strongly in 2022 to easily cover the next full-year dividend. Hence, despite my misgivings about global trends, I’d happily buy shares in this FTSE 100 firm today.
