These FTSE 100 and FTSE 250 stocks are on sale right now. Here’s why they’re on my shopping list of top stocks to buy when I next have cash to invest.
Tritax Big Box REIT
Real estate investment trusts (or REITs) fell sharply in value last year as interest rates steadily rose. Bank of England action pushed down their net asset values (NAVs) and drove up borrowing costs on their large debts.
This remains a threat in 2024 as inflationary pressure rolls on. But I still believe Tritax Big Box REIT (LSE:BBOX) shares are a brilliant buy right now.
This isn’t just because interest rates still look likely to decline from their recent highs. It’s also thanks to the FTSE 250 firm’s exceptional all-round value.
Created with TradingView
As the chart above shows, Tritax’s share price trades on a forward price-to-earnings (P/E) ratio of 18.4 times. This is well below its historical average which sits in the low-to-mid 20s.
What’s more, the FTSE 250 firm’s forward dividend yield sits at a healthy 4.9%.
But don’t just think that Tritax is a great value stock for 2024. I’m confident that the firm — which owns and operates warehouses and logistics hubs — will deliver excellent long-term returns as e-commerce growth drives property demand.
Consultancy Knight Frank believes an extra 45m square feet of UK warehouse space will be required between 2023 and 2027 as online sales boom. In this climate companies like Tritax, whose like-for-like rental growth accelerated to 3.6% in the first half of 2023, should deliver healthy earnings growth.
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Coca-Cola Hellenic Bottling Company
Drinks bottler Coca-Cola Hellenic Bottling Company (LSE:CCH) is one of my favourite so-called S.W.A.N. (or Sleep Well At Night) stocks. Demand for its product remains stable at all points of the economic cycle. And so I don’t have to worry too much about future profits.
Okay, competition is intense across the soft and energy drinks markets. So the Footsie company (like any UK share) isn’t totally immune to risk.
But on balance I think it’s solid as a rock. I also believe it’s too cheap to miss at current prices. Today Coca-Cola HBC shares trade on a forward P/E ratio of 12 times, well below their historical average in the high teens to early 20s.
This isn’t all. As the chart below shows, the British business also trades at a discount to other multinational beverages businesses. PepsiCo and The Cola-Cola Company even trade on P/E ratios twice as high as Coca-Cola HBC!
Chart created with TradingView. Shows the forward P/E ratios of (in descending order) PepsiCo, Coca-Cola Company, Keurig Dr Pepper, Britvic, and Coca-Cola HBC.
This seems hard to justify given the UK company’s exceptional momentum. Organic revenues soared 17% between January and September, a result that prompted the company to raise its medium-term annual growth targets to 6%-7%.
The firm has a right to be increasingly optimistic, in my view. It has its finger on the pulse of consumer tastes and, by extension, a terrific record when it comes to product innovation. Its winning labels like Coke, Sprite, and Fanta, meanwhile, provide the bedrock for robust sales and profit growth almost every year.
This is a top-class FTSE 100 stock I plan to never sell.
