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A watchlist of FTSE 100 stocks has been compiled, narrowing down several choices to five key options for consideration this autumn. Among these, one stands out as particularly exciting.
First on the list is BP (LSE:BP), the oil and gas giant. Despite its vast global presence, the shares appear to be trading at a surprisingly low valuation. The recent drop in oil prices has been the driving factor behind this, with Brent crude now down to $73 per barrel, influenced by weaker demand from China and growing concerns over a potential US recession. After experiencing a 15.76% decline over the past year, BP’s shares are now trading at just 6.21 times earnings, offering a substantial yield of 5.41%.
Next up is Unilever (LSE:ULVR), the well-known consumer goods behemoth. After a challenging period, it seems to be on the path to recovery and is once again being viewed as a reliable defensive option within a broader portfolio. The Unilever share price has risen by 23.06% over the last year, meaning the stock isn’t as cheap as it once was. Trading at 22.63 times earnings, the yield currently stands at 3%. However, there is potential for continued earnings growth, which could enhance long-term returns.
A particularly attractive option is JD Sports Fashion (LSE:JD). Earlier in the year, shares in this retailer dropped following a profit warning triggered by disappointing Christmas sales, but the stock has made a significant recovery since. After publishing its results on 22 August, JD Sports Fashion reported a 2.4% rise in like-for-like sales, sending its share price up by 18% within a week. The company’s board also reaffirmed its pre-tax profit guidance, which ranges from £955m to £1.035bn. Additionally, its recent acquisition of the Alabama-based retailer Hibbett has expanded its exposure to the US market.
However, the stock has taken a slight dip recently, dropping 6.67% over the past week, although it has still managed to achieve a modest 7.29% gain over the last 12 months. This pause in the stock's rise may present an opportunity to increase exposure to JD Sports at a fair valuation, making it a compelling option for those seeking exposure to the retail sector.
