I think these FTSE 100 and FTSE 250 stocks are too cheap to miss right now.
Bank of Georgia Group
A strong Russian economy is a good thing for close neighbour Georgia. So as the war in Ukraine drags on — and with it the threat of more sanctions on Russian people and companies — a near-term cloud hangs over the Eurasion country.
Yet, I’d still buy Bank of Georgia Group (LSE:BGEO) shares today. The FTSE 250 share has risen 41% in value so far in 2023, and I expect it to continue rising as the retail banking sector there explodes.
Operating income and underlying pre-tax profit here soared 35% and 48% between January and June, latest financials showed. Unlike with UK banks, these improvements weren’t down to soaring interest rates. In fact the country’s central bank has been trimming its benchmark since the spring.
Instead, Bank of Georgia is thriving as rising wealth levels in the country drive demand for financial products. Its loan portfolio grew 17.6% in the first half of 2023, with double-digit increases being recorded across its Retail Banking, SME Banking, and Corporate Investment Banking units.
I like the steps the bank is taking to exploit its booming domestic market. In particular, I believe its huge investment in digital banking will pay off handsomely as the tech revolution rolls on. Bank of Georgia recorded 1.22m digital customers in the first half, up more than quarter year on year.
Today the company trades on a forward price-to-earnings (P/E) ratio of 4.1 times. It also carries a 7.7% dividend yield for this year, with City analysts expecting the bank’s balance sheet to support more market-beating dividends.
Coca-Cola HBC
FTSE 100-quoted Coca-Cola Hellenic Bottling Company (LSE:CCH) is another top UK share with brilliant dividend prospects. City analysts expect ordinary dividends — which have increased by 129% over the past decade — to keep rising through to 2025 at least.
This is thanks in large part to the incredible brand power of its drinks like Coca-Cola, Fanta, and Sprite. They remain a staple in shoppers’ baskets regardless of the economic landscape. This means the company can raise prices to boost profits without fearing a significant loss of volumes.
Between January and June, net sales at the company rose 19%, while operating profit more than doubled (up 102%). Cost inflation may remain a problem for the company, but its pricing strategies could still help earnings march higher.
Robust cash flows mean that Coca-Cola HBC has the firepower to continue investing for long-term growth, too. This could be through continued investment in brands and product innovation, right through to further acquisitions (over the summer it spend $220m to purchase the Finlandia vodka brand).
The soft drinks bottler carries an 3.3% dividend yield for 2023, which is on the ‘decent’ rather than ‘spectacular’ end of the spectrum. But its corresponding price-to-earnings growth (PEG) ratio of 0.2 still marks it out as a brilliant value stock to buy.
Any reading below one indicates that a stock is undervalued.
