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Looking for cheap FTSE 100 shares to buy now? I like these stocks

If you’re looking for cheap FTSE 100 shares, you have no shortage of options at the moment. After the recent stock market crash, many stocks are trading well below their 2020 highs.

Here’s a look at three cheap stocks I like the look of right now.

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FTSE 100 healthcare giant

One FTSE 100 stock that I believe offers a lot of value at present is GlaxoSmithKline (LSE: GSK). It’s currently trading on a trailing P/E ratio of about 13.

What I like about GSK is that its areas of focus – pharmaceuticals, vaccines, and consumer healthcare products – are particularly relevant right now. Not only is the whole world waiting for a Covid-19 vaccine to appear (GSK has partnered with Sanofi to develop one), but demand for flu medication and painkillers is also on the rise due to the coronavirus.

Another thing I like about Glaxo is that it has defensive qualities. Even in a recession, people still need medication. That’s an advantage in the current environment.

GSK recently issued an excellent set of Q1 results. For the quarter, turnover was up 19% and adjusted earnings per share were up 26%. The company declared a dividend of 19p per share.

All in all, I think GSK looks attractive right now.

Government-backed revenues

Another FTSE 100 stock I like at the moment is defence specialist BAE Systems (LSE: BAE). Its share price has fallen from around 670p in February to just over 500p today. On last year’s earnings, that puts the stock on a trailing P/E of about 11.

BAE Systems isn’t going to be everyone’s cup of tea. However, there are a number of things I like about the company. 

For starters, its revenues are essentially backed by the government due to the fact it’s a key supplier to the UK Ministry of Defence and the US Department of Defense. And with geopolitical tension across the world remaining elevated, government spending on defence should remain robust in the years ahead.

Secondly, the group has been branching out into high-growth areas in recent years, including cybersecurity and anti-money laundering services. This provides a growth angle.

BAE recently said it had seen no material impact on the financial performance of the group in Q1. It also advised it has a strong liquidity position.

All things considered, I think the stock has significant appeal right now.

Long-term growth story

Finally, I also like the look of financial services group Prudential (LSE: PRU). It was trading near 1,500p in February. Yet today, the stock can be picked up under 1,100p.

The reason I like Prudential is that it is now predominantly focused on the savings and insurance needs of those in Asia. Given that wealth across Asia is rising at a prolific rate, I see significant potential for growth here over the next decade.

I am confident that, with our clear focus on our structural growth markets and our continuing operational improvements, we will continue to deliver profitable growth for our investors and benefits for our stakeholders over the medium and long term,” said CEO Mike Wells recently.

Unlike many other FTSE 100 firms, Prudential hasn’t cut its dividend yet. Last week, it said it will pay a second-half dividend of 20.84p per share to UK shareholders on 15 May.

Overall, I see Prudential as a high-quality company. I’d be happy to buy now while the shares are cheap.

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Edward Sheldon owns shares in GlaxoSmithKline, BAE Systems, and Prudential. The Motley Fool UK owns shares of and has recommended GlaxoSmithKline. The Motley Fool UK has recommended Prudential. 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.