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Summary
- Footsie index comprises of 101 blue-chip companies, which usually have a global footprint and are too big to fail.
- The large-cap companies might be the safest bet in the stock markets as of now.
- Despite the pandemic-stricken environment, these businesses have delivered resilient performance, staggering returns, along with dividend payments.
London’s broader equity benchmark index FTSE 100 or Footsie is on path to recovery as we head deeper into a post vaccine world in 2021. Since January, FTSE 100 has gained by more than 3.5 per cent. The Footsie index comprises 100 blue-chip or large cap companies, which mostly have a global footprint.
With governments accelerating vaccination programmes across the globe, most of the nations have lifted lockdown restrictions, and economies are resuming production and services. The large-cap companies might be the safest bet in the stock markets as of now. These companies usually have a global footprint and are too ‘big to fail’.
Investing in Footsie-listed businesses is less risky in contrast to other indices. However, the profit of these companies might get impacted due to currency fluctuations or geopolitical changes as they have a global footprint.
Also read: 5 Dividend Stocks Under Investors’ Radar in 2021
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Keeping this in mind, we shall put our lens through some Footsie-listed business that are expected to do well.
- Glencore Plc (LON:GLEN)
Jersey-based Glencore Plc (LON: GLEN) is a well-diversified natural resource company. The company did well in its industrial metals segment and delivered a flat adjusted EBITDA of US$ 11.6 billion. The company has a strong balance sheet along with liquidity of US$ 10.3 billion.
The company has delivered a strong operational performance across most commodities during the second half of 2020 despite the weak financial performance in the financial year 2020. The company witnessed an outstanding marketing performance that led to a surge in EBIT by 41 per cent year-on-year.
The company has witnessed strong cash flows during the second half of 2020. Also, the company proposed shareholders a distribution of US$ 0.12 per share.
In the past one year, the shares of the Company delivered a significant return of 88 per cent. Shares of Glencore traded at GBX 286.90 on 10 March 2021 at GMT 9:30 AM+1.
- Anglo American Plc (LON: AAL)
FTSE 100-listed miner Anglo American Plc is witnessing positive consumer demand trends and a continued recovery in rough diamond demand in 2021. In FY21, the company expects production to be in the range of 32-34 million carats, with improved grade performance at Jwaneng and Venetia and an increase in the ore. Meanwhile, the company maintains a robust balance sheet, delivering strong cash returns and investing in value-adding growth. It is also targeting carbon neutrality across the operations by 2040. Overall, the company is on track to deliver the longer-term target of a 45-50 per cent EBITDA margin.
The company has shown strong margins across the business, supported by the solid recovery during the second half of 2020. Over the next three to five years, the company is expected to deliver margin-enhancing and sector-leading volume growth of 20-25 per cent.
Notably, the board had proposed a final dividend of US$ 0.72 per share, with an ex-dividend date on 18 March 2021 and payment date of 7 May 2021. Shares of Anglo American delivered a staggering return of more than 92.28 per cent in the past one year. Anglo American shares traded at GBX 2,891 on 10 March 2021 at GMT 10:28 AM +1.
- EVRAZ Plc (LON: EVR)
EVRAZ Plc is a FTSE 100-listed Industrial Metal Mining Company. The year 2020 was an unprecedented one, with a robust free cash flow of US$ 1,020 million along with a continued reduction in debt.
The consolidated EBITDA was down by 15 per cent year-on-year, driven by the decline in prices of steel, vanadium and coal products, along with lower sales recorded for tubular and flat-rolled steel products.
However, the net profit surged by 2.4 per cent year-on year to US$ 858 million. The company declared an interim dividend per share of US$ 0.30, with an ex-dividend date of 11 March 2021 and a payment date of 7 April 2021.
In FY21, the company shall continue to improve its customer focus and operational efficiency by using digital tools and automation. During the second half of 2020, the company saw an upswing in the global markets, with solid operating and financial results.
The company seems to be well-positioned; has a sound business model along with a decent business growth rate trajectory. Shares of EVR delivered a staggering return of more than 150 per cent in the past one year. EVR shares traded at GBX 583 on 10 March 2021 at GMT 10:02 AM +1.
