1 wonderful FTSE 100 stock I’d love to buy

This Fool explains why this FTSE 100 stock looks like an excellent stock for her and her holdings and details her investment case.

| 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.

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.

FTSE 100 incumbent RELX (LSE: REL) is one stock I’d love to buy when I have some free funds to invest.

Let me explain why!

Data king

I’d agree with those willing to argue that RELX probably isn’t a household name. It doesn’t have the same pull as other popular brands. However, it has the hallmarks of a smashing company that provides a key product to many businesses across the world.

Should you invest £1,000 in Bunzl Plc right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Bunzl Plc made the list?

See the 6 stocks

A leader in data and analytics services, it is renowned for the high-quality actionable information it provides to professionals across the world. A prime example of this is its LexisNexis database used by the legal profession. I’ve used this personally in a previous life. For context, it contains 138bn legal and news documents for professionals in the industry to call upon.

RELX shares have had a fantastic 12-month period, up 31%. At this time last year, they were trading for 2,788p, compared to current levels of 3,667p.

Created with Highcharts 11.4.3RELX PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.co.uk

Why I like RELX shares

As well as RELX’s wide presence, vast sector coverage, and reputation for high-quality information, which make it an industry leader, there are other aspects I like too.

One of the biggest ones is the way it makes money. Its recurring revenue model, whereby subscribers pay a monthly fee to access the information they need, means revenues can grow and visibility is excellent from an investor perspective.

This same model has meant RELX has a good track record of performance. For example, I can see revenue and profit have grown each year for the past four years. However, I do understand that the past isn’t a guarantee of the future.

Speaking of the future, I’m really excited by RELX’s use of artificial intelligence (AI). It’s worth noting that RELX confirmed it hasn’t recently jumped onto the bandwagon, but has been incorporating AI into its tools for a while. However, now, it has created a specific suite of products built on AI to help boost performance and its offering.

Finally, a dividend yield of 1.65% sweetens the investment case. However, I do understand that dividends are never guaranteed.

Risks to note

Everyone loves a bargain, let’s be honest. RELX shares do not fall into that category, as they trade on a price-to-earnings ratio of close to 30. Perhaps growth is priced in? Could the shares take a hit if earnings fall? I’ll keep an eye on this.

The other risk is that of the AI revolution. Competition from other tech firms in this space could dent RELX. Plus, AI could be a flash in the pan, and real world applications could be years away, so I’ll be watching closely.

When it comes to RELX, I can’t help thinking of one of my investing role models in Warren Buffett. To paraphrase the Sage of Omaha, I’m happy to pay a fair price for a wonderful company.

In my view, the past has been good, and the future could be even more exciting for RELX.

But what does the head of The Motley Fool’s investing team think?

Should you invest £1,000 in Bunzl Plc right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Bunzl Plc made the list?

See the 6 stocks

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 no position in any of the shares mentioned. The Motley Fool UK has recommended RELX. 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.

Our best passive income stock ideas

Do you like the idea of dividend income?

The prospect of investing in a company just once, then sitting back and watching as it potentially pays a dividend out over and over?

If you’re excited by the thought of regular passive income payments, as well as the potential for significant growth on your initial investment…

Then we think you’ll want to see this report inside Motley Fool Share Advisor — ‘5 Essential Stocks For Passive Income Seekers’.

What’s more, today we’re giving away one of these stock picks, absolutely free!

Get your free passive income stock pick

More on Investing Articles

Investing Articles

4 REITs Fools own for passive income

REITs often have higher-than-average dividend yields compared to other stocks, making them a solid choice to consider for passive income…

Read more »

artificial intelligence investing algorithms
Investing Articles

Up 272% in just a year, is Palantir stock just getting started?

This writer recognises that Palantir has grown its business very well -- but does the stock price offer him an…

Read more »

Runner standing at the starting point with 2025 year for starting in new year 2025 to achieve business planing and success concept.
Investing Articles

Up 50%? The Aston Martin share price forecast is mind-blowing! 

If analysts are right, the Aston Aston Martin share price could absolutely rocket in the year ahead. Harvey Jones says…

Read more »

Investing Articles

As the S&P 500 drops, here are 2 Stocks and Shares ISA holdings I’m watching

Our writer has different views on how President Trump's tariffs might affect these two US holdings in his Stocks and…

Read more »

Surprised Black girl holding teddy bear toy on Christmas
Investing Articles

£10,000 invested in Tesla stock at Christmas is now worth…

Tesla stock has been one of best-performing investments of the past decade. But things haven't gone to plan for investors…

Read more »

Investing Articles

Up 279% in 5 years, could Meta stock keep soaring?

Meta stock has more than tripled in five years. This writer sees lots to like about the business but also…

Read more »

Pink 3D image of the numbers '2025' growing in size
Investing Articles

25% total return in a year? Is now the perfect time to buy BP shares?

BP shares are on the front line of today's global economic and political uncertainty but analysts think they can still…

Read more »

Affectionate Asian senior mother and daughter using smartphone together at home, smiling joyfully
Investing Articles

With Cash ISA changes coming, could now be the time to consider buying shares?

Changes to the Cash ISA could lead to greater investment in the stock market. This could be a good thing…

Read more »