Every month, we ask our freelance writers to share their top ideas for shares to buy with investors — here’s what they said for April!
[Just beginning your investing journey? Check out our guide on how to start investing in the UK.]
Breedon
What it does: it’s a construction materials company supplying aggregates, cement, asphalt, concrete and specialist building products.
By Kevin Godbold. With the share price near 381p (26 March), Breedon’s (LSE:BREE) numbers look attractive. City analysts predict a double-digit percentage advance in earnings for 2025, and the dividend looks set to yield almost 3.9% that year.
Solid full-year results on 6 March suggest further dividend progress ahead.
Trading in the UK and Ireland markets has been good, and I’m optimistic about the gathering strength of both economies.
Breedon announced the completion of an acquisition on 7 March aimed at expanding the business into the “fragmented and growing” US construction materials market.
Chief executive Rob Wood expects the acquisition to be earnings enhancing while allowing
a conservative and flexible balance sheet. That should enable further dividends and more bolt-on acquisitions as opportunities arise.
I’m keeping in mind that Breedon operates in cyclical markets capable of presenting challenges for the business at some point. However, the growth and income opportunity looks attractive to me here.
Kevin Godbold does not own shares in Breedon.
J.D. Wetherspoon
What it does: J.D. Wetherspoon is a UK pub chain. It’s known for consistent food, decent beer, and low prices.
By Stephen Wright.J.D. Wetherspoon (LSE:JDW) shares fell 8% after the company’s most recent trading report. But I think this is a buying opportunity.
Others are concerned that the reduced number of pubs is a headwind for growth. That’s certainly a risk, but I think there’s more going on with this business.
As I see it, the company is disposing of its weakest assets to focus on its strongest ones. And that’s a strategy several other businesses – including Unilever and GSK – have been employing recently.
Meanwhile, sales increased by around 8% and widening margins meant operating income almost doubled. Both of these numbers look encouraging to me going forward
A drop in earnings per share was due to intangible or non-repeating items and a free cash outflow was the result of timing of supplier payments. So I’m looking past this and buying the stock.
Stephen Wright owns shares in J.D. Wetherspoon.
Prudential
What it does: Prudential offers insurance and asset management products in markets where there is low penetration.
By Andrew Mackie: The Prudential (LSE:PRU) share price has fallen 35% in the past year, making it one of the worst performers in the FTSE 100. As it languishes at levels barely above its Covid lows, I’m sniffing an opportunity to top up my holdings.
The company is exclusively focused on Asia and Africa, both high-growth markets. Its suite of products and services is offered through a multi-channel distribution network of agents and bancassurance.
Agents are the lifeblood of its business. A significant portion of its 68k monthly active agents are members of the prestigious Million Dollar Round Table association. Its Agency business had a fantastic 2023, with new business profit growth up 75% in 2023.
PRUForce, its technology-driven distribution platform for agents, is a key differentiator in attracting talent and increasing workforce productivity.
Of course there are risks. The company’s balance sheet assets is predominantly composed of government and corporate bonds. As the value of these assets is linked to interest rates, sustained higher rates may negatively impact their valuation.
Nevertheless, when I look at the opportunities across its key markets, I find it hard to believe that its share price will languish at these low levels for very long.
Andrew Mackie owns shares in Prudential.
Reckitt
What it does: Reckitt is a multinational fast-moving consumer goods manufacturer and marketer that owns brands including Finish and Gaviscon.
By Christopher Ruane. Blue-chip bargain or a falling knife – how best to describe Reckitt (LSE: RKT)?
The shares have moved down recently to their lowest price in over a decade.
There are good reasons for that, including a recent unfavourable legal judgement in the US relating to the company’s problematic infant nutrition formula business and sharply lower operating profit last year. Net revenue declined in the most recent quarter, due in part to accounting irregularities in a couple of Middle Eastern markets.
Clearly, management has a lot of work to do.
However, the business has a portfolio of attractive premium brands in categories likely to experience ongoing demand. It generates substantial free cash flow, is profitable with attractive margins and has been reducing net debt.
With a dividend of 4.4% and price-to-earnings ratio of 14, this FTSE 100 firm looks like offering good long-term value to me despite the risks.
Christopher Ruane does not own shares in Reckitt.
Trainline
What it does: Trainline is a UK digital rail and coach technology platform that has operations across Europe.
By Muhammad Cheema. Trainline’s (LSE:TRN) shares increased 21.2% last month when it published a trading statement ahead of its FY24 results.
The FTSE 250 company saw great growth. Net ticket sales grew by 22%, from £4.3bn to £5.3bn. This resulted in revenue growing by 21% to £397m.
What I like about it is its international opportunity.
Both Spain and Italy saw a combined increase of 43% in net ticket sales.
Yet, the firm currently generates only £1bn in net ticket sales from Europe. Compared to the £3.5bn it generates in the UK, it’s got a huge opportunity to grow significantly in this market. The signs of this happening are looking very optimistic as it’s currently Europe’s most downloaded rail app.
However, it needs carrier competition for its services to be useful. France and Germany are examples where growth has been hindered because of this.
Still, Trainline is sitting in a prime position to take advantage of the shift to paperless train tickets.
Muhammad Cheema does not own shares in Trainline.
