Buying these 2 bargain stocks now could make you a millionaire retiree

These two shares offer significant upside potential.

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With the FTSE 100 having enjoyed a Bull Run in the last few years, finding shares to buy for the long term may seem more challenging. After all, some stocks are trading at relatively high levels and this suggests they may fail to generate above-average returns in the long run.

Despite this, here are two shares which appear to trade on very low valuations given their positive outlooks. As such, they could be worth buying today and may help to make you a millionaire retiree.

Impressive performance

Reporting on Thursday was property regeneration specialist St. Modwen (LSE: SMP). The company’s trading update showed that it has continued to deliver on its strategy, making solid progress. It has focused its energy on the higher performing industrial and logistics sector, as well as its homes business. Beyond this, the rest of the company’s diverse portfolio continues to perform well and it expects to report results for the full year that are in line with previous guidance.

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With a price-to-book (P/B) ratio of 0.9, the company appears to be cheap at the present time. This may be because investors are generally apprehensive towards the property sector, with an uncertain economic outlook being at least partly to blame. In the near term, there could be falls in valuations across the sector, but in the long run there may be an opportunity to generate high returns.

St. Modwen is forecast to deliver a rise in its bottom line of 9% in the next financial year. This suggests that its trading conditions remain positive, while its strategy offers an opportunity for it to add value for investors. Therefore, now could be the perfect time to buy it while it offers a wide margin of safety.

Turnaround potential

Also trading on a relatively low valuation at the present time is Standard Chartered (LSE: STAN). It has experienced a turbulent period that has seen its bottom line move into the red. However, it was able to return to profitability last year and is expected to deliver growth in 2017 and in 2018. In fact, its pre-tax profit is forecast to rise from £315m last year to over £1.3bn in 2017. This is due to be followed by a further increase in pre-tax profit to over £1.8bn next year.

Despite such a positive outlook for the business, it trades on a price-to-earnings growth (PEG) ratio of just 0.5. This suggests that investors remain cautious about its outlook as global growth remains uncertain to some degree, with political risk likely to be high for some time.

Although many shares in the FTSE 350 have risen to all-time highs, Standard Chartered appears to offer clear upside potential. With a strategy which has already launched a successful turnaround, new investors in the stock may be able to benefit from a potentially rapid rise in financial performance in 2018 and beyond.

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Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Peter Stephens owns shares in Standard Chartered. The Motley Fool UK has no position in any of the shares mentioned. 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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