Attractive Shares Following Recent Market Volatility
The market volatility that the COVID-19 pandemic caused has opened up some fantastic opportunities to invest in FTSE 100 shares that haven’t really been on the radar for some time. Certain stock prices have been trading very low recently, and some great companies currently have shares at very attractive prices. Though caution is important, the following shares look like great prospects.
Royal Dutch Shell
As oil prices have tumbled through this global crisis, Royal Dutch Shell (LSE:RDSA) slashed its dividend from $0.47 to just $0.16 per share. But oil prices have strengthened in recent weeks and demand for oil is likely to increase as lockdown around the world are eased. If there is a surge in demand, the price of oil will shoot up.
Of course, a rising oil price is not a long-term fix for shell. The company needs to move away from fossil fuels to focus more on renewables and has set itself a target of being net-zero emissions before 2050. Nevertheless, the current share price at Royal Dutch Shell is arguably a bargain and a rare opportunity for investors.
Prudential
Asia and the USA are Prudential’s largest markets after its UK business split in 2019. The life insurer announced a dramatic downturn in its Asian premium sales in May due to the pandemic, largely down to consumer behaviour in China and Hong Kong. At the same time, sales increased in the US and Africa.
Asia is a challenging territory for business with the escalating tensions between China and the USA. These difficulties, crystallised by the Coronavirus pandemic, have caused Prudential’s share price to fall 17% in the year-to-date – a price-to-earnings ratio of ~9. With the company’s commitment to maintaining dividend payments, there is a prospective yield of approximately 3%.
The company is well-positioned for a strong market recovery, so now is a good time to buy shares.
For the shrewd investor, an event that shakes up global markets like COVID-19 has is an opportunity to find new prospects. These are two of the most promising on the FTSE 100 and definitely worth consideration by any active investor.