Since the stock market crashed in March, the FTSE 100 has climbed by 22%. However, the index is still down by 19% since the beginning of the year. Over the last few days, investor sentiment has deteriorated and global stocks have slumped. As such, for investors with a long-term outlook, it may be an ideal time to pick up some of the best stock market crash bargains.
Stock market crash bargains
The extent of the market crash means there are still plenty of cheap shares on offer in the FTSE 350. Even so, spotting them is a challenge. Nevertheless, finding companies with potential to deliver a solid financial performance over the coming years could result in attractive returns.
In current market conditions, I think investors should look for businesses boasting strong balance sheets and healthy cash flows. Such companies are better equipped to weather the storm and continue growing despite an unfavourable economic outlook.
Businesses that have thrived throughout the global pandemic are by no means guaranteed to continue doing so. But their strong performance could be an indicator that they are better suited to operating in burdensome conditions. With that in mind, they could be among the best shares to buy now.
Best shares to buy now
Think of consumer goods giant Unilever (LSE: ULVR). The company came out of the first quarter of 2020 relatively unscathed, thanks to higher demand for cleaning products cancelling out lower demand for foods and ice cream. The recent sell-off pushed the group’s price-to-earnings ratio down to 19, classifying the stock as a bargain in my eyes. What’s more, efforts to consolidate the group into a single UK company should make acquisitions and disposals more straightforward in the future.
Then there’s online delivery service Just Eat Takeaway (LSE: JET). Having become Europe’s largest food delivery group after its merger with rival Takeaway.com in December, the company has capitalised on surging demand for home food orders. This gives Just Eat something to build upon moving forward. Moreover, I’m impressed that the company is already in more merger talks, this time with US company Grubhub. I expect demand to be sustained in a post-pandemic world allowing growth to continue. For this reason, I think Just Eat shares are truly among the best to buy now.
Finally, I think bookmaking holding company Flutter Entertainment (LSE: FLTR) is worthy of a mention. Despite the cancellation of sports fixtures worldwide, the group has increased its gambling revenues by 10% year-on-year. Moreover, thanks to the recent legalisation of sports betting in the US, there’s an ideal opportunity for Flutter to cement itself as a market-leader in the industry. Additionally, I think the company’s recent merger with Stars Group, the Canadian online gaming titan, will prove to be a catalyst for further growth. As such, a P/E ratio of 36 is amply justified in my view, especially given the upside potential of the shares.
Matthew Dumigan has no position in any of the shares mentioned. The Motley Fool UK owns shares of and has recommended Unilever. The Motley Fool UK owns shares of Flutter Entertainment. The Motley Fool UK has recommended Just Eat Takeaway.com N.V. 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.