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2 unloved FTSE 100 stocks I’d buy before it’s too late

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As the UK moves out of lockdown and the economy’s wheels begin to turn a little quicker, the FTSE 100 has gained a boost and has tracked upwards quickly from the start of April. Good news for the broader economy, however, does not always equate to good news for individual companies.

I’ve pulled out two Footsie companies that have had a difficult time of late but, as a result, may represent an opportunity for me to buy. I will personally be following their progress closely to make the most of their lower cost before a potential rise.

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AstraZeneca

The chances are that you’ve read quite a bit about AstraZeneca (LSE: AZN) in the news lately. The FTSE 100 company has had a bit of a rollercoaster ride of late, soaring as its Covid-19 vaccine began its rollout across Europe and now hitting a tricky spot as reports over potential blood clot risks of this vaccine arose.

It’s my view that the market has overreacted to the news because the vaccine represents only a relatively small part of its overall business. In fact, the crown jewel for AstraZeneca is its portfolio of oncology treatments that achieved sales of $11.4bn in 2020, with the three major treatments in that portfolio growing sales by over 35% year-on-year.

Currently, the company won’t take any profits from its vaccine until July of this year, after which there are estimates it will bring in $2bn in sales in 2022. Not a small sum but when its top selling oncology product, Tagrisso, is already bringing in $4.3bn and growing, it does put this in perspective.

With the negative PR likely to rumble on, shares in the company could continue their downward trend from highs of last year. This is definitely one I’ll be watching and potentially buying into should they drop even further.

HSBC

Covid-19 has hit many businesses on the FTSE 100 hard, though many are recovering as the UK begins to open up. Some are recovering quicker than others, and one that still has some way to go before getting back to pre-pandemic levels is HSBC (LSE: HSBA). Prior to the pandemic, shares in the company were selling at just under 600p but have now fallen to around the 430p level.

This isn’t unusual in the banking sector, other companies are also fighting their way back to previous levels, but for HSBC the situation is a little different. Not only is it down on early 2020 figures, it’s also been on a decline since reaching highs of almost 800p in 2018.

Like other UK banks, there has been significant amount of restructuring taking place since the financial crisis of 2008, and current CEO, Noel Quinn, has previously announced plans to reduce the cost base of the business to increase earnings, as it deals with the current low interest rate environment.

One factor that could significantly boost earnings is the company’s performance in Asia, particularly China. HSBC has a strong presence in China and signalled back in February that it would pivot its focus towards Asia where it generates 90% of the company’s profit.

With some Asian countries, specifically China, faring much better during the pandemic and likewise seeing a rapid rate of recovery, this could see HSBC’s strategic position there pay off. This is why I’ll keep an eye on the company to see whether it can begin to outperform its FTSE 100 peers in the future, with a view to buying for the long term.

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Ben Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has recommended HSBC Holdings. 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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