FTSE shares in 2025: an opportunity to get rich?

The FTSE hasn’t universally satisfied investors in recent years, but there are certainly enticing opportunities on the index in 2025.

| 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.

We can’t hide from the fact that, well, since Brexit, the FTSE has underperformed many of its peers. The FTSE 100 has grown sluggishly, with a mere 15% increase since the 2016 Brexit vote, translating to annualised gains of only about 2%. This underperformance is stark, especially when compared to other major markets — the tech-focused Nasdaq‘s up over 500% in the last decade.

So to many investors, the FTSE isn’t the place to get rich. But I’d challenge that narrative. While the major of my investments are in US-listed stocks, there are certainly enticing prospects and pockets of exceptional value in the UK, as well as unbeatable dividend-paying stocks.

Undervalued dividend payers

The first category is dividend stocks. Because UK stocks generally haven’t seen the level of share price appreciation of their US counterparts, many dividend-paying stocks now offer outlandishly large dividend yields.

Should you invest £1,000 in AstraZeneca 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 AstraZeneca made the list?

See the 6 stocks

This is simply because, in many cases, UK companies have continued to increase dividend payments, while the share prices have underperformed. This builds on the basic maths that when share prices fall, dividend yields go up.

With this in mind, investors may want to focus on strong dividend payers, notably those that appear to be undervalued. This could present investors with the opportunity to benefit from strong dividend yields, an improving dividend payment, and share prices appreciation.

This could include stocks like Lloyds. The banking group trades at a 20% discount to its average share price target while the current dividend yield of 5%’s expected to rise to 7% by 2026 on the back of dividend payment increases.

Finding the next multi-bagger

The term multi-bagger is used to describe a stock which doubles in value, or goes even higher. And according to Schroder UK Mid-Cap Plc, the UK, surprisingly, has a great track record for delivering multi-baggers.

However, finding the next multi-bagger can be challenging. And it can be difficult to know where to look. AIM-traded MaxCyte could be one option if we’re using analysts’ recommendations as a starting point.

The cell-engineer technology specialist has a price target of 672.05p, indicating that the stock could push 109.3% higher from its current valuation.

A sensible option for consideration

While a single year of investing may not make an investor rich, it can certainly put them in the right direction to build wealth over the long run. One company investors could consider to help them on this journey is pharma giant AstraZeneca (LSE:AZN), which has been in the wars in recent months, with its share price dropping due to multiple factors.

Clinical trial setbacks for its lung cancer treatment Dato-DXd, underwhelming early data from its weight loss drug portfolio, and an ongoing investigation in China have contributed to the decline. Despite these issues, analysts remain bullish on AstraZeneca, with no Sell ratings issued. The stock’s trading around 31% below the average share price target.

The company’s forward price-to-earnings ratio’s projected to improve significantly, from 35.6 times in 2023 to 17.4 times by 2026, reflecting confidence in sustained earnings growth.

Moreover, AstraZeneca’s diversified portfolio, particularly its strength in oncology and immunology, is expected to offset regional pressures. While concerns about potential sales weakness in China persist due to the government probe, analysts forecast that the company’s performance in other key markets will support continued success.

Of course, there are plenty of other passive income opportunities to explore. And these may be even more lucrative:

We think earning passive income has never been easier

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

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.

James Fox has positions in AstraZeneca Plc Lloyds Banking Group Plc. The Motley Fool UK has recommended AstraZeneca Plc and Lloyds Banking 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

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 »

Investing Articles

These FTSE 100 dividend shares just got cheaper, thanks to President Trump!

Investors buying dividend shares can lock in bigger long-term yields when share prices take a tumble. These two just did…

Read more »