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I have been touring the FTSE 100 and FTSE 250 to find the best value stocks to buy today. Here are two that I think are worth serious consideration from a growth standpoint. and income investors.
JD Sports Fashion
JD Sports Fashion's (LSE:JD.) has been affected by weak retail trading conditions (particularly in North America) in recent times. But with interest rates falling, City traders believe profits are about to soar again.
A 7% increase is forecast for this financial year to January 2025. This improves to 15% and 16% for fiscal years 2026 and 2027, respectively.
I am not surprised by these bullish projections. They also reflect further rapid growth in the athleisure fashion market, a segment in which JD is a market leader, as well as the company's global expansion drive.
These projections mean the retailer, at 123 pence per share, is trading on a price-to-earnings (P/E) ratio of just 9.7 times for this year. This is well below the FTSE 100 average of 14.4. This reading also reduces to 8.5 and 7.3 times for financial years 2026 and 2027.
Furthermore, during these two years, JD's price-earnings ratio (PEG) growth falls well below the water mark of 1. These are 0.6 for the next year and 0.5 for the next fiscal period .
On the downside, dividend yields aren't especially great. However, the prospect of rapid dividend growth still makes JD an attractive income stock for me.
Its dividend yield of 0.7% for this year increases to 0.9% and 1.1% in fiscal years 2026 and 2027.
Ibstock
A big chunk of UK stocks will benefit from the targets set out in this week's Budget. Infrastructure, renewable energy, defense and healthcare stocks, for example, could be big beneficiaries.
Home builders and building materials suppliers could also emerge winners. The government has pledged to spend big to deliver on its promise to build 300,000 new homes a year. This starts with a £5 billion cash injection in 2025 alone, as announced in the Budget.
brickmaker Ibstock's (LSE:IBST), a FTSE 250 company whose profits could soar in this context. It should also get a boost as repair and maintenance of Britain's housing stock – reportedly the oldest in the world – continues with gusto.
Ibstock shares don't look particularly cheap for this year. At 205 pence per share, they trade on a P/E ratio of 26.3 times for this year. However, this multiple plummets over the next two years as profits rise, to 19 in 2025 and 14.4 the following year.
City analysts expect earnings per share to soar 38% and 32% in 2025 and 2026, respectively.
Furthermore, Ibstock's PEG multiple is only 0.5 for these two years.
These bright forecasts also lead to predictions of strong dividend growth. Thus, the dividend yield on Ibstock shares goes from 2% for this year to 2.7% and 3.5% in 2025 and 2026.
High interest rates remain a threat to business. But at current prices I think it deserves a lot of attention, along with JD.
