3 post-Brexit picks I'd buy now
Are you on the look-out for shares to buy? Are you encouraged by the stock market resurgence that has taken place in the past few weeks and want to add to your investments? Then look no further. In this article, I'll summarise three of the companies that I currently favour.
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There's been a surprising amount of optimism after the dramatic victory of the Brexiteers a month ago. Britain is a remarkably strong country, and it has shown an impressive ability to carry on with business as usual.
So here I choose a housebuilder, an insurer and a healthcare company as my three post-Brexit picks.
Barratt Developments
Property firms like Barratt Developments(LSE:BDEV) have taken an absolute pummelling in the aftermath of the Brexit vote. BDEV has fallen from 600p just over a month ago to 418p today. Yet much of the rest of the FTSE 100 is actually up. How can this be explained, and is it justified?
Well, with some believing immigration will be falling over the next few years, the view is that there'll be less demand for properties in Britain. That could lead to falling house prices, and a lower number of transactions.
Yet I would query this thesis. Britain isn't going to leave the EU for several years yet. That means an a large influx of immigrants for the time being. And job creation is still motoring on at a pace of knots, as the recent employment data has shown.
That's why I think the tumble in Barratt's share price isn't a reason to sell out, but a buying opportunity. And a trailing P/E ratio of 9, with a dividend yield of 2.84%, both indicate how cheap this stock is.
Aviva
Aviva(LSE:AV) is an insurance business whose valuation has been on the slide recently. But I still firmly believe in the investing credentials of this firm.
From a high of 570p last year, the share price now stands at 381p. Yet Aviva's net profit in 2015 was over £1bn, and this global company has strong prospects for long-term growth, particularly in emerging markets.
That's why a trailing P/E ratio of 13, with a dividend yield of 4.98% will appeal to investors on the lookout for both growth and yield.
AstraZeneca
Drugs company AstraZeneca(LSE:AZN) has confounded the naysayers in recent years, as this once shaky pharmaceuticals giant has turned itself around.
AstraZeneca is perhaps the most innovative of all the leading drugs firms, and a new generation of medicines, including several anti-cancer treatments developed by its biologics arm Medimmune, are set to drive earnings ahead in years to come.
New world-class research labs in Cambridge show the direction this company is going, and profitability and the share price have been going from strength to strength. A trailing P/E ratio of 19, with a dividend yield of 4%, make this company worthy of closer examination.
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Prabhat Sakya has no position in any shares mentioned. The Motley Fool UK has recommended AstraZeneca. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.
