3 of the best FTSE 100 stocks to consider in May
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With the FTSE 100 tearing to new document highs, now may very well be a good time for traders to splash out on UK blue-chip shares.
Listed here are three I believe are worthy of significant consideration this month.
Beautiful returns
Prior to now 20 years, no present Footsie inventory has offered higher returns than rental tools enterprise Ashtead Group (LSE:AHT).
The agency has constructed itself to turn into a significant trade participant in that point, thanks primarily to a rolling programme of shrewd acquisitions. And it has no intention of dialling again its aggressive progress technique. It made 26 extra acquisitions within the 9 months to January. This can be a constructive omen.
Ashtead’s share worth has sunk greater than 7% in lower than per week. It’s fallen as hopes of rate of interest cuts have pale, a situation that would drag on near-term earnings progress.
Following this decline, I’m contemplating growing my very own stake within the enterprise. The rental tools trade’s extremely fragmented, leaving room for a lot of extra profits-boosting acquisitions. And the long-term outlook for the development trade stays extraordinarily vibrant.
10% dividend yield
I additionally just like the look of M&G (LSE:MNG) following a big share worth reversal. It now trades on a ahead price-to-earnings (P/E) ratio of 8.8 occasions.
On high of this, its dividend yield for this 12 months stands at 10%. This might make it a superb purchase for traders looking for a market-beating passive earnings.
Like Ashtead, the corporate’s dropped as hopes of rate of interest cuts have pale. However this isn’t the one hazard to income. M&G operates in a extremely aggressive trade and has to paddle extraordinarily arduous to succeed.
However there’s additionally quite a bit I like about this UK share. Most of all, I’m eager on its robust place in a market with important long-term progress potential. I anticipate earnings right here to rise strongly over the approaching a long time as demographic modifications drive demand for financial savings and funding merchandise.
I additionally like M&G because of its bettering steadiness sheet. A Solvency II ratio of 203% provides it scope to proceed paying giant dividends and to spend money on the enterprise for future progress.
Commodities big Glencore‘s (LSE:GLEN) share worth has soared in 2024, due to rising steel costs, and particularly copper. With commodity costs tipped to maintain climbing, now may very well be the time to purchase this Footsie share.
Mining generally is a extremely problematic (and thus pricey) exercise. Because of this earnings can come below extreme strain, even when steel costs improve.
Fortuitously, Glencore additionally has a sprawling buying and selling arm which helps to mitigate this danger. In truth, this unit’s thriving for the time being. Earnings listed below are tipped to hit the upper finish of forecasts in 2024, the corporate introduced this week, at between $3bn and $3.5bn.
I’m assured that proudly owning Glencore shares might yield glorious long-term returns. Tendencies like decarbonisation, urbanisation, and the AI revolution are tipped to supercharge commodities demand within the coming a long time.