The FTSE 100 index has zoomed past the 7,000 mark in today’s trading. If it closes above this level, it will be for the first time since February last year. For me this conclusively says that the index is now indeed past the stock market crash of last year.
I am optimistic that it will continue to rise from here. Forecasts for the economy are positive. Economic growth is driven by business performance, so it follows that at least some of the FTSE 100 companies should bounce back.
Oil companies, airlines, tourism, banks and discretionary consumer goods are just some of the industry segments that should pick up pace as the world gets back to normal. Among these, here are two FTSE 100 stocks I’m considering that I reckon will do well going forward.
#1. Coca-Cola HBC hikes dividend
Switzerland based Coca-Cola HBC (LSE: CCH) suffered a setback in 2020. But there is still much to like about the stock. First, I like that despite a hit to revenues, it remained profitable even if less so than previously.
Two, it expects revenue recovery this year as well as margin expansion. This is in line with the overall recovery in consumer markets for the Coca-Cola bottling company, and should bode well in the coming years as well.
Three, it increased its dividends marginally as well. It has a yield of 2.3%, which is far from the highest. But the increase in dividends does indicate its confidence in the future.
Inflation is a risk to its profits, however. It mentioned this in its outlook for the year. Going by rising commodity prices, including oil, and the opening up of demand, this could be a challenge for Coca-Cola HBC. However, there is a debate as to how much inflation will actually rise and whether it will increase enough to impact costs in a significant way.
#2. Reckitt Benckiser share price inches up
After almost free-falling through the second-half of 2020 and even the start of 2021, FTSE 100 consumer healthcare company Reckitt Benckiser (LSE: RB), is seeing better days now. Its share price has broadly been on the upward trajectory since the end of February.
The new-found confidence in its share price follows its final results for 2020. There was plenty to like in them. Its revenue increased by around 9%, with the biggest increase seen in the hygiene segment. Its operating profits were also marginally up on a constant currency basis. Covid-19-related costs impacted the company’s profits increase but there was a 17% reduction in net debt.
Unlike many FTSE 100 shares that have run-up even though their performance suggests they perhaps shouldn’t have done, the Reckitt Benckiser share price actually has a fair bit of steam left. It is still 14% below its 2020 highs.
Much as in the case of Coca-Cola HBC, though, I am on the lookout for the impact of inflation on the company. Incidentally, the term comes up a few times in its results update as well. But aside from the risk of rising costs, I think it is a good stock for me to consider buying now.
