Navigating markets in 2022 has been far from easy. And as a retail investor, the untold amounts that have been wiped off global markets has made it difficult to know where to put my money. However, I’m staying positive. I think the current market presents plenty of opportunities to buy some shares and hold them for the long run. With this, I’m on the lookout for FTSE 100 stocks I can buy this month.
Here are two I’m considering.
My first choice is the arms and security business BAE Systems (LSE: BA.). The stock has had a prosperous year, rising over 45% year to date. Over the last 12 months, it’s up an impressive 44%.
The main reason for the rise is the war in Ukraine. While the conflict will have a direct influence in generating business for BAE, it’s also driven defence concerns across the globe. With talks of a ‘new Cold War’, BAE has seen a higher demand for its products.
The first six months of the year saw the firm’s underlying profits rise by 8.2%. However, what was arguably more significant was the order backlog of £52.7bn, an 18% rise from the same period in 2021.
The stock also offers a dividend yield of around 3.1%. While this isn’t FTSE 100 average beating, the business has looked to increase shareholders’ returns this year, including an increased interim dividend and a £1.5bn buyback programme. These are positive signs.
What could see the business struggle in the months ahead is the higher cost of materials as inflation continues to surge.
However, with a positive outlook for 2022 and beyond, BAE Systems shares look like good value to me.
The second stock I’m looking at is pharmaceutical giant GSK (LSE: GSK). The multinational healthcare business is best known for offering medicines and vaccines. The stock has fallen over 9% this year. In the last 12 months, it’s down 8%.
This week saw the firm release its Q3 results, where it reported continued strong growth. For the period, sales rose 9% to £7.8bn, including impressive 24% growth in its Speciality Medicines.
The business raised its guidance back in July. However, Q3 has seen it push up this guidance again, with it now expecting growth in sales to be between 8% to 10%.
This continuous growth follows the demerger of its consumer healthcare division, Haleon. The move has allowed GSK to streamline its operations and siphon off debt. And with CEO Emma Walmsley describing the move as undoing the “Gordion knot” that has hampered GSK’s balance sheet, the early signs are that the move is working.
What also draws me to GSK, like BAE, is its dividend yield. This currently sits at around 6.4%. With inflation reaching a fresh 40-year high for September, the passive income generated from this seems like a smart move.
GSK will also likely be impacted by higher costs as inflation continues on its charge. Yet despite this, I see long-term potential.
I like both of these stocks. However, I won’t have the cash to buy both in November. I should have enough to buy one, so I’ll probably look to pick up GSK.
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And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if BAE Systems made the list?
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Charlie Keough has no position in any of the shares mentioned. The Motley Fool UK has recommended GSK plc and Haleon plc. 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.