5 Quality FTSE 100 Shares I Would Buy Now

Numerous FTSE 100 stocks have made phenomenal gains so far this year. They include some of the most well-known names in the index. Companies like J Sainsbury (+ 35%), Lloyds (+ 38%) and PA (+ 47%).

However, there were also notable losers. Among them are a number of high quality stocks with attractive trading fundamentals. In fact, there are five of these blue chips that I think are very buyable at the moment.

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Quality FTSE 100 shares at a reduced price

The table below shows the performance of the FTSE 100 and the five stocks for the year to date and over the past 12 months.

Year to date (%)

12 months (%)

FTSE 100

+12

+24

Hikma Pharmaceuticals

-5

-11

Unilever

-ten

-17

Intertek

-ten

-16

Smith and nephew

-14

-12

Fresnillo

-23

-35

As you can see, all five stocks significantly underperformed the Footsie Index. These reduced prices seem too good to miss.

Healthy growth

Hikma Pharmaceuticals specializes in branded and unbranded generic drugs. Bringing new generics to market can be difficult, but the company has a good track record of obtaining regulatory approvals.

A recent acquisition (subject to regulatory approval) further strengthens its product portfolio, pipeline and R&D capabilities. I see good value in a rating of 16.5 times the expected profit for the current year for a company that plans to increase profits by more than 20% in 2022.

Warren Buffett tried to buy this FTSE 100 stock

Unilever is known worldwide for its brands of home and personal care products, as well as food and refreshments. Brand building has become a bit easier for new entrants to the digital age, but I think it would be hard to dislodge loved and trusted brands like Unilever’s. Domestos, Vaseline and Hellmann’s.

The company is currently valued below the price early investor Warren Buffett was willing to pay a few years ago. And that’s good enough for me.

Quality assured

Intertek is one of the world’s leading providers of total quality assurance, providing assurance, testing, inspection and certification services from its network of more than 1,000 laboratories and offices in more than 100 countries.

Quality assurance is an area of ​​structural growth and the Covid-19 pandemic has only increased demand for Intertek’s services. Growing the business through acquisitions adds some risk, but I think the long-term opportunities are such that a premium of 26 times the expected earnings for the current year shouldn’t be prohibitive for me.

A pandemic falter

The Smith & Nephew medical device group has several divisions but is probably best known for hip and knee implants. The company’s performance over the past 18 months has been compromised by postponements of elective surgeries due to the pandemic.

However, I am looking beyond the short-term challenge of regaining the pre-pandemic commercial momentum. I see value in a rating of 20 times the expected profit for the current year, with the company planning to increase profits by more than 20% in 2022.

The worst performing action of the FTSE 100

Declines of 23% for the year so far and 35% in the past 12 months, make Fresnillo the worst performing stock in Footsie. The company is the world’s largest silver producer and one of Mexico’s largest gold miners.

The volatility of precious metal prices tends to be exaggerated in the movements of the stock price of a miner like Fresnillo. I can live with this. Indeed, this is what gives me the current opportunity to buy into a company with a strong balance sheet, high quality assets and low cost operations at a rating of 15 times the expected profit for the current year. Classes.


GA Chester has no position in any of the stocks mentioned. The Motley Fool UK recommended Fresnillo, Hikma Pharmaceuticals, Intertek, Lloyds Banking Group, Smith & Nephew and Unilever. The opinions expressed on the companies mentioned in this article are those of the author and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. At The Motley Fool, we believe that considering a wide range of ideas makes us better investors.


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