Talk of a stock market crash has been swirling for weeks. The S&P 500 looks pricey but the FTSE 100 is on the up. Will it all end in tears? The truth is, nobody knows.
Waiting for a crash before buying shares is daft. It’s just too unpredictable. Investors who sit on the sidelines waiting for the perfect moment typically miss out on a heap of growth and dividends. That said, I’d be daft not to take advantage if stocks did plunge. Here are two shares I’m keen to buy, and would be even keener if they suddenly became cheaper.
Goodwin offers income and growth
Engineering group Goodwin (LSE: GDWN) has been run by the same family since 1883, and clearly still know their stuff. Over the past 20 years, shareholder returns total 4,632%, according to company figures, compared with 282% from the FTSE 250 as a whole over the same term.
I was planning to buy before its annual results on 30 July but missed the chance. The numbers were impressive. Pre-tax profit for the year to 30 April jumped 47% to £35.5m on revenue of £220m, while the dividend more than doubled to 280p. Net debt fell sharply to £13.6m, thanks to £67m generated from operations.
The shares rocketed and now trade at 9,680p, leaving them on a price-to-earnings (P/E) ratio of 29.7. I’m kicking myself as a result but if we do get a correction, I’ll be ready to strike. I’m not out to make a quick buck here. My plan would be to buy and hold for years, letting the dividends and long-term growth compound. It’s exactly the kind of business long-term foolish investing is built on.
Bunzl’s bugging me
FTSE 100-listed Bunzl (LSE: BNZL) sells everyday essentials that keep businesses running, from paper towel to gloves and cleaning supplies. I’ve previously labelled it boring, but I meant it as a compliment. The shares have grown steadily for years, while the dividend has risen annually for decades.
Lately, Bunzl’s been anything but dull. Its shares have slumped 28% over 12 months, with the bulk of the damage coming from a profit warning on 16 April. Demand’s down in its key North America market, with trading sluggish in Europe and the UK too. As a result, Bunzl looks affordable on a P/E of 12. Recent updates suggest trading’s back in line with expectations, but management remains cautious, given the global backdrop. So do investors.
I’m wary of rushing in too soon after a profit warning, as these situations often take time to reverse. Yet if a wider market crash drags Bunzl lower, I’d find it impossible to resist. For bargain hunters taking a long-term view, this looks like a solid buy and hold to consider.
Ready to deploy
These two stocks are at the top of my watchlist. Both offer something different: one a family-controlled growth story, the other a reliable consolidator with global reach. I’d like to own them both. I’d love to pick them up at a reduced price. And if the crash doesn’t come? I’m not leaving my money idle for long.
