Investing alongside you, fellow Foolish investors, here’s a selection of shares that some of our contributors have been buying across the past month!
BP
What it does: BP is a global oil and gas company. It’s one of the largest companies in the world measured by revenues.
By Charlie Keough. The BP (LSE: BP.) share price has been gaining momentum in 2024. As I write, it’s up 7.2% year to date.
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As such, I decided to increase my holdings in the Footsie powerhouse. The stock looks cheap, trading on around seven times trailing earnings. To go alongside that, it boasts a 4.5% dividend yield. That’s above the FTSE 100 average of 3.9%.
The largest risk to the business is the transition to a greener future. We’ve seen mounting pressure placed on firms such as BP in recent years.
However, I’m confident it’ll be some time before we see fossil fuels completely phased out. It has been widely touted that the target for reaching net zero is 2050. But that’s now being questioned. What’s more, BP has a strong energy transition strategy in place.
At its current price, I couldn’t resist. If I have any spare cash going forward, I may look to pick up some more shares.
Charlie Keough owns shares in BP.
GigaCloud Technology
What it does: GigaCloud’s platform connects furniture factories in Asia with resellers in Western Europe and North America.
By James Fox. GigaCloud Technology (NASDAQ:GCT) has created a niche for itself, connecting ‘large parcel retailers’ – furniture makers – typically in China, with resellers and consumers in higher wealth markets. As such, the name is slightly misleading, and having followed analysis of this stock closely in recent months, it’s putting some investors off.
Nonetheless, the business looks highly attractive. It’s trading at 14.1 times forward earnings and 11.7 times earnings for 2025. GigaCloud is a business in overdrive, with revenue increasing 94.8% over the past 12 months. Management recently guided towards another strong quarter, with revenue above estimates.
There is some concern about the impact of Red Sea disruption on the business. However, management has suggested that Asia-Europe is a much smaller part of its business compared to Asia-North America. There was no mention of the Panama drought.
All in all, I find this highly volatile stock an attractive long-term pick, with considerable potential for share price growth.
James Fox owns shares in GigaCloud Technology.
Hunting
What it does: Hunting produces specialised equipment used for oil and gas drilling and related activities.
By Roland Head. I added Hunting (LSE: HTG) to my portfolio in early March, after the company published a strong set of 2023 results and confirmed a positive outlook for 2024.
Hunting suffered during the pandemic period due to a slowdown in drilling activity. This highlighted the company’s main weakness – it’s heavily cyclical and dependent on the spending plans of its energy producer customers.
However, demand recovered strongly last year, with revenue up 28% to $929m and pre-tax profit of $50m, reversing a 2022 loss. The company’s balance sheet remained in good health, in my view, with modest net debt of $33m and an overall net asset value of $957m.
This net asset figure is equivalent to a book value of around 455p per share, substantially above Hunting’s recent share price of 320p. I think there’s value here – also highlighted by the stock’s 2024 forecast price-to-earnings ratio of 10 and dividend yield of 2.8%.
Roland Head owns shares in Hunting.
Imperial Brands
What it does: Manufacturers and markets tobacco and tobacco-related products to customers in the UK and abroad.
By Mark David Hartley. With headquarters in London and Bristol, Imperial Brands (LSE:IMB) is one of the largest multinational tobacco producers in the world. I decided to buy shares in the company for two reasons – a buyback program and a high 8.5% dividend yield.
The controversial nature of the tobacco industry threatens valuations, leading firms to initiate incentives such as buybacks and increased dividends. The trade-off is a subdued share price in exchange for more profitable dividend returns.
Imperial’s most recent earnings reported an impressive £3.4bn in operating profit, representing an increase of 26% from the previous year. Subsequently, analysts forecast an average 16% price rise in the coming 12 months.
However, despite strong financials, shares are down 5.5% this year. The weakened performance has prompted IMB to initiate a £1.1bn buyback program, half of which is already done with the second half to be completed by the end of October.
Mark David Hartley owns shares in Imperial Brands.
Kraft Heinz
What it does: Kraft Heinz is a packaged foods company. Around 33% of the company’s revenues come from condiments and sauces.
By Stephen Wright. I started buying shares in Kraft Heinz (NASDAQ:KHC) for a while now. When I started, I had a specific investment thesis.
While I wasn’t expecting huge revenue increases from the company, I thought an improving balance sheet would allow it to return more money to shareholders over time. And that’s been happening.
After bringing its debt down over the last few years, the firm has now reached a point where its leverage is under control. As a result, it has begun a share buyback programme.
The market doesn’t seem too impressed – the stock hasn’t responded particularly positively. But with my initial thesis seemingly playing out, I’ve been adding to my investment.
Results from the fourth quarter of 2023 were hampered by inflation and this is a risk going forward. In my view, though, the stock looks like a bargain at today’s prices.
Stephen Wright owns shares in Kraft Heinz.
Legal & General Group
What it does: Legal & General Group is one of Europe’s largest investment managers and financial services companies.
By Royston Wild. Back in March, I bought shares in financial services colossus Legal & General Group (LSE:LGEN) for the second straight month.
I had cash to invest after selling out of veterinary care provider CVS Group on rising regulatory threats. And Legal & General shares still looked attractively priced despite recent price gains.
Today the company still looks dirt cheap. It trades on a forward price-to-earnings (P/E) ratio of 9.2 times. Furthermore, its dividend yield stands at a brilliant 8.8% dividend yield.
I was especially attracted to the company on account of its dividend prospects. Its forward yield is currently far ahead of its ten-year average of 6.9%. This reading also comfortably beats the 3.8% average for Footsie shares.
This dividend yield is also well supported by Legal & General’s cash-rich balance sheet. The company’s Solvency II capital ratio stood at an enormous 224% as of December.
These formidable financial resources could give it scope to pay above-average dividends for years to come, as well as the means to invest for future growth.
Royston Wild owns shares in Legal & General Group.
