The BAE Systems (LSE: BA) share price soared in January before solid profit taking trimmed monthly gains. I think the FTSE 100 defence giant could rebound strongly as speculation over Ukraine military action mounts.
The geopolitical landscape is becoming increasingly tetchy and in this sort of environment demand for weapons systems rises. Even if war in Eastern Europe is averted, BAE Systems’ hardware will remain in high demand following this latest spat with Russia. China’s support for Moscow’s “legitimate security concerns” in recent days has escalated concerns among Western powers even further.
Problems with project delivery are an ever-present that could damage orders for BAE Systems’ technology. But the company’s strong record on this front provides me with peace of mind. Today, the company trades on a forward P/E ratio of 11 times while it boasts a chunky 4.4% dividend yield too. I think it could be a great addition to my investment portfolio today.
6.5% dividend yield!
I believe Barratt Developments (LSE: BDEV) is another excellent FTSE 100 stock to buy this month. The rising cost of living and the slowing UK economy are problems that could hit homes demand in 2021. But, as things stand, the domestic housing market looks rock solid
In fact, Nationwide says the housing market has made its strongest start to a year since 2005. The building society says average home prices soared 11.2% in January to £255,556. This provides me with confidence looking ahead.
I already own shares in Barratt and I’m thinking of buying more, given that it still looks dirt-cheap. The builder trades on a forward P/E ratio of just 8 times. It also boasts a monster 6.5% dividend yield.
I expect Barratt to prove a canny investment over the long haul. I think lower-than-usual interest rates will remain in place to support buyer affordability. I’m also confident that schemes such as Deposit Unlock and Shared Ownership will keep the market healthy, despite the withdrawal of Help to Buy next year, allowing first-time buyers to continue getting a foot on the property ladder.
A FTSE 100 retail winner
The rising strain on consumer wallets could also make B&M European Value Retail (LSE: BME) a great share to own right now. Inflation is crushing consumer spending power and the strain looks set to intensify in April as tax hikes come into being and energy costs rocket.
This is playing into the hands of value retailers. And B&M, with its 700-strong store network is well-placed to capitalise on this trend. Kantar Worldpanel says the average yearly food bill is set to rise by £180, illustrating that Britons face a stretch their shopping budgets.
Today, B&M trades on a prospective P/E ratio of just 13.8 times. I think this is good value, given the company’s enormous sales opportunity. I’d buy it despite the company’s lack of an e-commerce channel. This could see it lose out to retailers such as Tesco and Amazon with their digital strength, for example.
