These 3 incredibly cheap stocks look like a great buying opportunity to me
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I like to buy cheap stocks and there are incredible ones FTSE 100 deals are available now. Especially these three.
Last Sunday (August 4), I realized that BP (LSE: BP) share price was at a 52-week low and it looks like “deal of the year!”
A large amount?
Shares of the oil giant have fallen another 2.48 percent since then. They are down 10.57% over 12 months and trade at just 6.26 times earnings. Even better, they yield 5.18%.
Its profits and share price rose during the energy crisis. However, as the price of oil fell, they fell in FY23, from $27.2bn to $13.8bn.
BP continued to reward long-term shareholders, increasing dividends by 10% and buying back shares of $7.9bn. At £20.9bn, its total debt is at a 10-year low.
With Brent crude now below $80 a barrel, investors still don't want to know. Others are wary as BP doubles down on fossil fuels, despite net zero push. Energy stocks go in cycles and I think the time to buy BP is when it's down rather than up. Global warming is causing accidents but I will buy it when I have the money.
Speaking of climate change, in July I flagged Lloyds of London insurance Beazley (LSE: BEZ). As a special risk insurance and restoration business it will pick up the tab from tomorrow's floods, hurricanes and hurricanes.
That partly explains why the share price is cheap, trading at just 4.47 times trailing earnings. That's despite its shares jumping 35.27% in 12 months, boosted by a 155% rise in 2023 pre-tax profit to a record $1.25bn.
Its good form continues as half-year results published on 8 August showed a record pre-tax profit of $728.9m, almost double last year's $366.4m. Beazley was the best performer of the FTSE 100 last week which rose 12.53%.
NatWest Group is back
Its 1.96% yield is low, but that's partly down to a growing number of shares. Another one I will buy if I have the cash.
NatWest Group (LSE: NWG) is also on the roll. Its shares are the second best performing in the FTSE 100 over the past six months, up 58.4%. Only Darktrace rose faster, up 68.2%. Over 12 months, NatWest is up 38.85%.
The big banks are finally living up to their potential, and NatWest's share price is on the rise. Yet it's still incredibly cheap, trading at 6.67 times earnings. The yield is also attractive at 5.11%.
Labour's decision to scrap plans to sell the government's remaining NatWest stake has boosted the stock, as there will be no more diluted shares flooding the market.
Analysts at Berenberg raised their price target to 415p. Today, NatWest is trading at 334p, so there is a potential 25% upside there.
It's not all happy days though. First-half profits fell 15.6% to £3.03bn while net profit fell 16 basis points to 2.07%. Margins may be further reduced when interest rates are reduced. Despite that, I would still buy NatWest at today's low price, if I hadn't been so big in the banking sector with. Lloyds Banking Group.
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