Towards the end of last week, I had flagged three FTSE 100 stocks I’d buy in November. My reasoning was that they are quite cheap. It appears that other investors thought so as well. A little over two weeks since I said that, all their share prices have shown double-digit growth. The Biden bounce and the hope of finally overcoming Covid-19 have led to a stock market rally, lifting fortunes of these stocks as well.
ITV and DS Smith rally
The biggest gainer among them is the FTSE 100 media company ITV, whose share price is up over 20% since. There’s little other news on the broadcaster until tomorrow, when it releases its trading update. I doubt if it would have returned to health given the sorry state of the economy and the tentative state of business. The outlook may also only be cautiously optimistic considering that we are back in lockdown in England. Yet, 2021 promises to be a better year, which could bode well for ITV, continuing to make it a stock I’d buy this month.
The FTSE 100 packaging provider DS Smith is the next biggest gainer, with close to 15% gain in share price since late October. Its upbeat trading update in the interim has undoubtedly added to the buoyancy in share price. According to CEO Miles Roberts: “We continue to be excited by the underlying drivers of demand…together with our focus on cost efficiency and cash generation, give us confidence in the business going forward.” This, along with the fact that it has reiterated its decision to pay a half-year dividend, makes it an attractive stock for me to buy even now.
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Glencore’s close behind
Lastly, the FTSE 100 mining giant Glencore has also seen a 10% plus increase in share price. It too posted a production update since I last wrote about it, which showed an increase in production in the latest quarter on a sequential basis as the impact of Covid-19 reduced. It has maintained its production guidance for 2020 across all products, except coal.
GLEN has its share of problems besides coronavirus, which include graft charges that threaten to derail its share price recovery. At the same time, the commodity cycle has clearly turned upwards with China’s fiscal stimulus and growth driving metals demand. Even with lower production, its financials may still be stable to growing as industrial metals’ prices stay strong.
Other FTSE 100 options
Besides these three, I think new buying opportunities have opened up among FTSE 100 components. While the market rally has driven up prices of long-battered stocks, some of the high-flyers are now seeing a sharp drop in share price. But, being fundamentally sound companies, I reckon it’s only a matter of time before they bounce back. I’m talking about the likes of Ocado, Just Eat Takeaway and London Stock Exchange Group. These are all good stocks at any point in time, but I think this good buying window might be a small one.
