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I am currently looking for FTSE 100 trading stocks at reduced prices. The UK’s blue chip benchmark looks set to break the 8,000 point barrier for the first time. Still, I think there are a number of value investment opportunities within the ranks of Footsie companies.
Here are three stocks that look cheap to me today.
british american tobacco
The first FTSE 100 stock on my list is british american tobacco (LSE: bats). The stock price is down 6% over the past year, and I think now might be a good time to buy more of the tobacco giant.
Modest full-year earnings results could make this stock a surprise pick. However, delving into the details, I think there are reasons to be optimistic.
Consumers of non-combustible products shot up from 4.2 to 22.5 million. This is essential as the tobacco business strives to reinvent itself to counter regulatory challenges.
I was also encouraged by the 6% growth in the dividend. The company is a stalwart in my passive income portfolio thanks to a 7.27% return, which is considerably above the Footsie average.
It is true that the unexpected absence of a new share buyback program and the exit from the Russian market are obstacles affecting the growth of the share price of British American Tobacco.
However, despite the risks, it seems to me that the shares are oversold considering the company remains on target to hit £5bn in revenue by 2025.
right movement
right movement (LSE:RMV) is the second FTSE 100 stock I would invest in if I had some extra money. I think the online real estate portal has a lot of upside potential.
A widely anticipated fall in UK house prices could be bad news for Rightmove’s share price. However, I’m not so sure. Rental returns remain strong and the company makes money from leasing agents and property sales.
Low debt levels, 84% market share and 101% operating cash conversion are compelling reasons to invest. There is also a handy dividend yield of 1.4%.
Despite the short-term headwinds, I am optimistic about the long-term outlook for the housing market. In my opinion, fundamental supply issues mean that any decline in activity should be short-lived.
The current P/E ratio of 26 is below the pre-pandemic level of 30. That suggests a value opportunity.
red river
red river (LSE:RIO) completes the trio. With some extra money, I would buy FTSE 100 mining company shares for the whopping dividend yield of 8.89%, but I think the chances of the share price going higher too.
China’s economic reopening and anticipated stimulus measures to support its ailing real estate sector are key drivers for the company.
Rio Tinto is heavily dependent on the price of iron ore, which is supported by China’s infrastructure spending. The country accounts for around 66% of maritime iron ore demand.
Copper is another major contributor to Rio Tinto’s revenue. Long-term demand should be strong as the metal has unique conductive properties that are particularly useful for renewable energy systems and electric vehicles.
In addition, political unrest in Peru threatens copper supplies in the world’s second-largest producer. This could raise the price higher.
A global economic slowdown could affect Rio Tinto’s share price, given the cyclical nature of the industry. That’s a risk you’d take for a market-leading dividend.
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