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3 FTSE 100 stocks I’d buy for an ISA in September

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As we always say here at the Fool, the best time to start investing is right now. Today I want to look at three FTSE 100 stocks I’d buy today for a Stocks and Shares ISA.

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Too cheap to ignore

My first pick is a stock I’ve been buying for value and income. Insurer Aviva (LSE: AV) is familiar name to most of us. However, you might not realise that this business trades at a big discount to the sum of its parts.

According to Aviva’s latest accounts, its book value is 473p per share. That’s a whopping 65% more than the last-seen share price of 285p. Of course, there are some reasons for this.

A history of acquisitions means that Aviva has businesses in France, Canada, Asia, Ireland, Poland, and Italy – as well as the UK. Not all of these businesses have the size and profitability you might hope for.

New boss Amanda Blanc has promised to strip back to the group to focus on its core markets in the UK, Ireland, and Canada. Achieving this won’t be easy. But Aviva’s finances look healthy enough to me and I expect this FTSE 100 stock to yield at least 5% next year.

In my view, Aviva is too cheap to ignore.

A proven performer

This may sound like an obvious choice, but there’s a reason why Unilever (LSE: ULVR) forms part of so many investors’ portfolios. History tells us this consumer goods group is able to produce consistent growth over many decades.

Owners of this FTSE 100 stock have enjoyed unbroken dividend growth for more than 50 years. One reason for this is Unilever’s impressive portfolio of brands, which includes names such as Ben & Jerry’s, Hellmann’s, Dove, Domestos, and many more. These names drive consistent sales with attractive profit margins.

Of course, Unilever isn’t cheap like Aviva. But I don’t think this share needs to be cheap to deliver attractive returns.

Unilever currently trades on around 22 times forecast earnings, with a dividend yield of 3.1%. I think that’s fair value. But these shares have risen by 165% over the last 10 years, while delivering steady income growth. I’d be happy to buy into another 10 years like that.

A FTSE 100 stock with a 200-year history

FTSE 100 industrial group Johnson Matthey (LSE: JMAT) has been trading for more than 200 years. This tells us that it’s survived many difficult patches before.

Right now, the group’s Clean Air division is struggling with the slump in demand for new cars. Johnson Matthey provides one in three of all catalytic converters fitted to new cars, but profits from this division fell by 25% last year. This is the group’s largest business, so the hit to profits is significant and management cut the dividend this year.

However, Johnson Matthey is already planning for the future and is investing in battery technology. Alongside this, the group’s existing pharmaceutical chemicals business is being scaled up.

Right now these operations aren’t making much money. But this FTSE 100 stock has fallen hard this year and now trades on just 11 times 2021–22 forecast earnings. I think Johnson Matthey should be a profitable long-term buy.

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Roland Head owns shares of Aviva. The Motley Fool UK has recommended Unilever. 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.

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