Business & Investment

I think these three FTSE 100 shares can double my money

It is a common misconception that investors need to buy high-risk stocks to get high returns. However, it is possible to get high returns from the FTSE 100 stock, which is a good stock. It may take some time, but I think it’s better than taking the risk.

With that in mind, there are three FTSE 100 shares that I believe can double my money in the next few years. Given those possibilities, I’m very happy to buy them all for my portfolio.

5 stocks to try to build wealth after 50

Markets around the world are recovering from the coronavirus pandemic … and so many great companies are trading at what looks like a “discount bin” price, so now there are some savvy investors. It may be time to get a potential bargain.

But whether you’re a novice investor or a veteran professional, deciding which stocks to add to your shopping list can be daunting during such an unprecedented era. There is a possibility of becoming.

Fortunately, the Motley Fool UK analyst team has nominated five companies that they believe still boast significant long-term growth prospects despite the global turmoil …

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Bank recovery

The first company on my list Natwest (LSE: NWG).. I feel that this company has the potential to double my money for two reasons.

First of all, it looks cheap. The value of the price-to-book value ratio (P / B) of the lender’s stock changes at about 0.65. This suggests that if stocks are traded to book value, their value can increase by 52%.

Technically, if a company is profitable, it deserves to be valued at or around its book value.Like a bank Increase profit, I think the evaluation will go up.

I think stocks can also increase my return by combining profit growth and dividend income. The stock is set to support a dividend yield of 4.3% next year. This income, combined with stock rerating, could provide a total return of 100% or more over a 10-year period.

However, if growth stops, these benefits may not be realized. Another economic crisis is probably the biggest threat to a company’s growth.

FTSE 100 recovery

Another company I believe can double my money in the next 10 years is the catering group Compass (LSE: CPG)..

Historically, this business has been acquired Organic growth.. Prior to the pandemic, businesses grew by more than 10% annually.

I don’t know why the group can’t go back to its previous strategy. There are many other targets that the company will acquire for its portfolio. Moreover, humans always need to eat, so they always need that service.

Assuming an organization can continue to grow at an annual rate of 10% and its stock price will track this growth, stocks could double my money in just over seven years.

Headwinds that can confuse this goal include inflation and rising wage costs. These can weigh on the rate of return and demand for the company’s services.

Next champion

The last company on my list is Income Champion Phoenix Group (LSE: PHNX)..

This company keeps the books of life insurance and annuity insurance. You can take advantage of economies of scale to reduce operating costs and derive cash synergies from newly acquired business books.

As a result of this strategy, Phoenix will be the dividend champion. The stock currently supports a dividend yield of 7.4%. According to my calculations, if you reinvest this dividend every year, you will be able to double your money in nine and a half years.

The risk of using this approach is that the company decides to reduce dividends. This could overturn my strategy. If it follows this route, it will be difficult for businesses to double my money.

However, there is also the possibility of capital gains. Price earnings ratio (P / E) is trading in multiples of 8.5 and looks cheap.

Rupert Hargreaves does not have a position in any of the shares mentioned. The Motley Fool UK recommends the Compass Group. The views expressed about the companies mentioned in this article are those of the author and may differ from the official recommendations made by subscription services such as Share Advisor, Hidden Winners, and Pro. Here at The Motley Fool, given the various insights, A better investor than us.



I think these three FTSE 100 shares can double my money

https://www.fool.co.uk/2022/01/09/i-think-these-ftse-100-stocks-can-double-my-money/ I think these three FTSE 100 shares can double my money

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