The outlook for the buy-to-let industry may be more positive following the general election. Fears surrounding a Jeremy Corbyn-led government and potential changes to taxation may mean that house prices make gains in the short run.
However, in the long run, the FTSE 100 could outperform buy-to-let investments. It appears to offer superior value for money, greater diversity and a range of stocks with sound growth strategies.
With that in mind, here are two FTSE 100 shares that could deliver impressive long-term total returns. They could help to bring your retirement date a step closer.
AstraZeneca
Recent updates from pharma stock AstraZeneca (LSE: AZN) have provided evidence of the scale of its turnaround. While in previous years it has struggled to generate top- and bottom-line growth, its sales and profitability are now growing at double-digit rates. This trend could continue over the medium term as the business benefits from the major investment it has made in its pipeline over recent years.
Risks facing UK investors may have subsided following the recent general election. However, global growth uncertainties remain in place. For example, political risk in the US and China may continue to be high in 2020, while tariffs could act as a drag on global GDP growth. Therefore, AstraZeneca’s defensive characteristics could help it to outperform many of its FTSE 100 peers. Its reduced dependency on the wider economy’s performance may mean that it becomes more popular among investors.
As such, now could be the right time to buy a slice of the company. Its improving financial performance and increasing favour among investors may mean that it outpaces house price growth in the long run.
Bunzl
One FTSE 100 share that is being negatively impacted by an uncertain global macroeconomic outlook is Bunzl (LSE: BNZL). The international distribution and services company recently released a trading update that showed the slowing sales trend from earlier in 2019 has continued.
For example, in its third quarter, the company reported a rise in sales at constant exchange rates of just 0.5%. When the impact of acquisitions is excluded, its sales declined by 1%.
Looking ahead, Bunzl has an active acquisition pipeline. It has already spent £100m on acquisitions this year, and is likely to continue to add new businesses to its portfolio over the medium term. They could catalyse its financial performance and help to offset an uncertain trading period for the business.
With a solid track record of growth that includes five continuous years of increasing earnings, Bunzl could offer long-term growth potential. Following its 12% share price decline in the last year, now could be the right time to buy a slice of it while it trades on a lower valuation. It may fail to recover significantly in the short run, but could offer turnaround potential in the coming years.
