The FTSE 100’s track record suggests a stock market recovery from the 2020 crash is likely. Certainly, it may take time for some large-cap shares to deliver improving stock price performances. However, long-term investors may be able to buy them today and experience impressive capital gains in the coming years.
With that in mind, here are two large-cap shares that could offer good value for money after the recent crash. They could be worth buying as part of a diverse portfolio of stocks, and may improve your chances of making a million.
Store closures have had a major impact on FTSE 100-listed Burberry’s (LSE: BRBY) financial performance over recent months. Its full-year results stated that half of its stores remain closed, which is clearly set to have a continued negative effect on its financial performance.
However, as the world economy gradually recovers, the luxury goods group could produce a share price turnaround. It was making excellent progress in implementing its strategy prior to the pandemic. For example, Burberry had enjoyed significant success releasing its new products under a new design footprint. It was also shifting its focus towards social and environmental concerns, which appeared to be resonating with consumers.
Since Burberry seems to have a sound balance sheet and is making progress in becoming more efficient, it looks set to overcome the near-term challenges faced by the consumer goods sector. As such, with its strong brand and what appears to be a sound long-term strategy, it could be worth buying after its 25% share price decline since the start of the year.
The FTSE 100 stock seems to have the potential to bounce back as investor sentiment and global GDP growth improve over the long run.
FTSE 100 bank Barclays
Another FTSE 100 share that’s fallen heavily in 2020 is Barclays (LSE: BARC). Its shares are currently down around 38% year-to-date, and could yet come under further pressure should economic data continue to disappoint.
The bank’s recent update highlighted positives, such as costs at the lower end of expectations and its financial position being relatively sound. However, it faces a period of potentially lower demand for many of its products. Lower interest rates may also cause the profitability of the wider sector to deteriorate. This could inhibit improvements in investor sentiment.
However, with Barclays having a relatively diverse business model and what appears to be a sound overall strategy, it could deliver improving performance as the world economy recovers. With its shares trading this year at their lowest level since the 2009 financial crisis, they could offer a wide margin of safety that allows them to produce capital growth over the long run.
Therefore, now could be the right time to buy them prior to the FTSE 100’s likely recovery from its 2020 market crash.
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Peter Stephens owns shares of Barclays. The Motley Fool UK has recommended Barclays and Burberry. 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.