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I think these FTSE 250 stocks could be too cheap to miss today. Here's why.
Home comforts
Home Builders Like Bell tower (LSE:BWY) have risen in value in 2024, with falling interest rates and improving buyer confidence helping house sales recover from recent lows.
It is encouraging that this upward trend remains intact. According to Halifax today (October 7), the average UK house price reached £293,399 in September. This was just below the record high of £293,507 reached before the housing market crashed around two years ago.
Prices are rising again due to falling mortgage costs and good wage growth. With the Bank of England (BoE) expected to continue cutting interest rates over the next 12 to 18 months, housebuilders should go from strength to strength.
Bellway's share price is up 22% since the start of the year. I think it could rise even further when full-year results are released next week (October 15), when the company reports on the current state of the market. In its last update in August, it said its weekly private booking rate per property rose 10.9% in the 12 months to June.
Of course, there are risks here. A sudden spike in inflation could lead the Bank of England to backtrack on its interest rate plans, hurting house sales in the process. Rising construction costs also remain a major threat across the construction industry.
Still, I think Bellway remains an attractive value stock to buy right now. It trades with a forward price-to-earnings growth (PEG) ratio of 0.8. Any reading less than 1 suggests that a stock is undervalued.
Playing a China comeback
Investing in stocks that rely heavily on China has been a miserable experience for many. My decision to buy Asian-focused products Prudential's stocks in 2020 have not paid off spectacularly so far.
But market sentiment appears to be shifting in favor of companies with large exposure to China, as evidenced by the recovery in Prudential's share price. For investors looking for recovery stocks, now could be a good time to consider stocks like these.
He Fidelity China Special Situations (LSE:FCSS) unit trust is a FTSE 250 asset on my watch list. Like The Pru, its price has also recovered strongly recently, as the chart shows.
However, at 247.5 pence per share, it is still trading at a substantial 10.7% discount to its net asset value (NAV) per share of 277.1 pence.
Trusts like this distribute capital across a wide range of companies, giving them access to many growth opportunities while allowing them to manage risk. In total, it has stakes in around 100 large, medium and small Chinese companies, including well-known names such as Tencent Holdings, Ping insuranceand Hello sense.
Look, there's no guarantee China's economy is over the worst. In fact, data from the Asian powerhouse remains frustratingly patchy. However, as policymakers accelerate stimulus measures to revive growth, things could be improving in the emerging market and, therefore, for Fidelity's confidence.
In fact, with China's growing middle class driving domestic consumption and technological innovation constantly improving, the long-term prospects are quite bright in my opinion.
