Here are 2 top FTSE 100 shares investors should consider buying

Sumayya Mansoor breaks down two great FTSE 100 shares that she believes could boost a portfolio of stocks.

| More on:

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.

Young black colleagues high-fiving each other at work

Image source: Getty Images

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.

Sage (LSE: SGE) and Bunzl (LSE: BNZL) are two great FTSE 100 shares I think investors should look into adding to their holdings. Here’s why.

Sage shares flying high

Sage is a developer and distributor of cloud-based accounting software for small to medium-sized businesses. I personally own Sage shares and they’ve performed well for me to date.

As I write, Sage shares are trading for 964p. At this time last year, they were trading for 742p, which is a 29% increase over a 12-month period. This is impressive considering many FTSE 100 shares have struggled in recent months.

Sage’s story to date is enviable, becoming a dominant market player from humble beginnings. It has a consistent track record of performance and has an excellent business model that includes recurring subscriptions to boost its healthy balance sheet.

With lots of cash, Sage can reward investors. A dividend yield of 2% isn’t the highest but I’m more interested in consistent and stable dividends. However, I do understand that dividends aren’t guaranteed.

From a risk perspective, Sage shares are currently trading at all-time highs. I’m conscious that any negative trading or bad news could send the shares tumbling. Furthermore, the artificial intelligence (AI) revolution has led concerns that the software products of tech firms like Sage might be obsolete or behind the times.

The good news is that Sage already incorporates AI tools within its offering. For that reason, I believe the business is primed for further growth by offering its customers the latest tech and keeping up with the times.

Overall, I believe Sage shares are a great option to consider as part of a diversified portfolio of stocks.

Bunzl shares struggle like other Footsie shares

Bunzl is one of the biggest distribution and outsourcing businesses in the world. With a presence in 30 countries, the business provides essentials such as disposable paper and plastic packaging supplies to a number of market sectors.

Bunzl’s share price journey is akin to many FTSE 100 shares in recent months. The shares have meandered up and down due to volatility. As I write, they’re trading for 2,846p, which is very close to the 2,850p level they reached at this time last year.

The company is dealing with macroeconomic issues. Firstly, supply chain issues could hinder its ability to provide its customers with the products they need. Next, soaring inflation and rising costs could be troublesome for the business as rising costs tend to take a bite out of profit margins.

However, there aren’t many FTSE 100 shares that can brag about increasing payouts for 30 years consecutively. Bunzl can! A yield of just over 2% today may seem modest but I’m buoyed by its fantastic record. However, I do understand that past performance is not a guarantee of the future.

Finally, I’d argue Bunzl’s products offer the business defensive characteristics. For example, it provides rubber gloves to the medical industry and packaging to the food industry. The essential nature of its offering has helped the business perform consistently and generate lots of cash to support its enviable investor return policy.

I think Bunzl shares look a great candidate for further research — they could even flourish further once this current volatility cools.

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.

Sumayya Mansoor has positions in Sage Group Plc. The Motley Fool UK has recommended Bunzl Plc and Sage Group Plc. 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

Photo of a man going through financial problems
Investing Articles

I asked ChatGPT to name the FTSE 250 share it would buy in a heartbeat – and it went mad!

Harvey Jones wondered whether artificial intelligence was up to the job of finding him a brilliant FTSE 250 share to…

Read more »

Tanker coming in to dock in calm waters and a clear sunset
Investing Articles

Is the BP share price primed for lift off?

As an activist investor takes a substantial holding in BP, Andrew Mackie assesses what it will take to energise the…

Read more »

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

No savings? I’m using the 5-step Warren Buffett method as I aim to get rich

Christopher Ruane outlines a handful of investment techniques he uses, inspired by the incredible stock market record of Warren Buffett.

Read more »

Mature Caucasian woman sat at a table with coffee and laptop while making notes on paper
Investing Articles

With a spare £3,000, here’s how a new investor could start buying shares

Our writer explains how someone with a few thousand pounds and no prior stock market experience could start buying shares…

Read more »

UK money in a Jar on a background
Investing Articles

£10,000 invested in Greggs shares in 2020 has made this much passive income…

Greggs shares have struggled lately due to economic weakness and rising costs. Are they still worth considering for an ISA…

Read more »

British union jack flag and Parliament house at city of Westminster in the background
Investing Articles

Don’t look now, but the FTSE 100’s beating the S&P 500 in 2025…

So far this year, UK stocks have been doing better than their US counterparts. So is the FTSE 100 the…

Read more »

Investing Articles

How much would someone need in UK shares to earn £5,000 in passive income each month?

Thousands of Stocks and Shares ISA investors have built up more than a million pounds and can sit back and…

Read more »

Investing Articles

£10,000 invested in Tesla stock 1 month ago is now worth…

Tesla stock is remarkably volatile for a mega-cap company. While this presents some opportunities for investors, it’s also inherently risky.

Read more »