Image Alt

The Investing Box

  /  Editor's Pick   /  2 great FTSE 100 stocks I’d buy to hold for 10 years!

2 great FTSE 100 stocks I’d buy to hold for 10 years!

Young Asian woman holding a cup of takeaway coffee and folders containing paperwork, on her way into the office

I’m searching for the best FTSE 100 shares to buy and hold in my portfolio for the next decade. Here are two I’m considering snapping up today.

Bargain buy

Consumer spending power is under pressure as the cost-of-living crisis endures. Latest data from the British Retail Consortium (BRC) shows total retail sales rose just 4.2% in January.

This was down on the three-month average of 5.2%. And this year on year rise was largely down to price inflation. In fact, the BRC said “the rise in sales masked a much larger drop in volumes”.

In this climate, snapping up value retail stocks like B&M European Value Retail (LSE:BME) could be a good idea. Low-cost operators like these are thriving as shoppers stretch their budgets as far as they can.

This FTSE 100 retailer grew like-for-like revenues 6.4% during the 13 weeks to Christmas Eve. And B&M said it put in a “very good performance” across both its grocery and general merchandise lines.

Buying value businesses like this isn’t just sound investing strategy for right now though. The budget retail segment has been growing strongly over the past decade as consumers become savvier with their cash. The breakneck rise of German discounters Aldi and Lidl is proof of this.

It’s a trend that’s tipped to run and run too. And B&M is expanding to make the most of this opportunity. It’s due to open four new stores in March alone.

Now it’s true that B&M operates in a highly competitive environment. In fact, its rivals are also rapidly building their store estates and Poundland alone plans to open or relocate 50 stores this year. But I believe the strength of B&M’s brand could still help it deliver robust shareholder returns.

Look East

Buying shares with emerging market exposure might also be a good way to generate long-term wealth. HSBC Holdings (LSE:HSBA) is one way I’m considering playing this theme.

This FTSE 100 company is increasingly pivoting towards Asia. This seems to be wise strategy, given the rate at which personal wealth levels there are rising. Financial product penetration is also low on the faraway continent too, providing plenty of scope for HSBC to grow revenues.

Encouragingly, regulators in China are loosening financial market rules to boost overseas investment as well. This could bolster economic growth across the entire region and provide added opportunities for the region’s banks.

I think HSBC is a great value stock to buy at current prices of around 600p per share. The bank trades on a forward price-to-earnings (P/E) ratio of 6.5 times. It also carries a market-beating 7.5% dividend yield.

I’m considering investing despite the threat of an upsurge of Covid-19 infections in China. I expect the firm to deliver stunning profits growth over the next 10 years.

The post 2 great FTSE 100 stocks I’d buy to hold for 10 years! appeared first on The Motley Fool UK.

Should you buy B&M shares today?

Before you decide, please take a moment to review this first.

(Even if you weren’t born before 1972.)

Because The Motley Fool’s top UK analysts have revealed: ‘5 Stocks for Trying to Build Wealth After 50’. And you can grab this report, absolutely free.

In our opinion, it’s never too late to build wealth with shares. Indeed, with markets down this may be an ideal time to start.

And while past performance is not an indicator of future results, history has shown that after shares fall by 20%, there’s a 90% chance they’ll be higher within 5 years.

When they do, the average return has been 61%.*

So while there are no guarantees, our analyst team have a habit record of finding such opportunities. In 10 minutes, this free report brings you up to speed.

See the 5 stocks

* Source: Robert Shiller, Economist – Yale University. Figures based on historic US market data from 1871 – Present, with additional calculations by The Motley Fool.

setButtonColorDefaults(“#5FA85D”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43A24A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#ffffff”, ‘color’, ‘#fff’);

More reading

HSBC Holdings is an advertising partner of The Ascent, a Motley Fool company. Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended B&M European Value and HSBC Holdings. 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.