To achieve long-term growth, I regularly turn to the London Stock Exchange to find the best companies. As April approaches, I’m on the lookout for firms to add to my portfolio. I’ve found two LSE shares that I’ll be buying during the coming month. What attracts me to these businesses? Let’s take a closer look.
LSE shares: Glencore
Glencore (LSE:GLEN) is a global mining company specialising in raw materials such as copper, zinc, and nickel. Recently, the firm has enjoyed higher commodity prices. Nickel, in particular, surged 28% in the past month on supply fears. I question, however, how long these high commodity prices will last.
Between the 2017 and 2021 calendar years, Glencore reported mostly strong growth in its financial results. During this period, profit before tax increased from $6.9bn to $7.3bn.
In addition, earnings-per-share (EPS) rose from ¢34 to ¢52. By my calculation, this results in a compound annual EPS growth rate of 8.9%. This is both strong and consistent. It should be noted, however, that past performance is not necessarily indicative of future performance.
Yet while profits and earnings increased over this time, revenue declined slightly from $205bn to $203bn. But Deutsche Bank recently raised its price target for Glencore from 450p to 500p. It currently trades at 505.4p, up 74% in the past year.
The mining firm also sold its New South Wales copper mine in Australia for $1.1bn to Spac Metals Acquisition Corp. This will allow the company to instead focus on sustainable, long-term activities.
Shares to buy in April: National Grid
The second firm I’m buying is National Grid (LSE:NG), a supplier of gas and electricity in the UK and US. It currently trades at 1,141p, up 31.7% in the past year.
Between the 2017 and 2021 calendar years, revenue declined from £15bn to £14.7bn. Additionally, profit before tax fell from £2.1bn to £2bn. EPS also tumbled from 56.9p to 46.4p.
While these longer-term results don’t fill me with confidence, recent results did bring some good news.
For the six months to 30 September 2021, operating profit increased almost 50% year on year. Furthermore, the firm raised its interim dividend to 17.21p per share from 17p for the same period in 2020.
Despite this, energy regulator Ofgem is investigating one of the company’s substations in Cumbria, due to potential safety issues. This could have a negative impact on the share price.
National Grid also sold 60% of its gas operation on 28 March for £2.2bn. This may be used to manage the firm’s not insignificant debt pile of £44.65bn.
Both of these companies exhibit growth and may enjoy favourable environments in the future. I will be buying shares in both businesses in April.
