The FTSE 100’s recent market crash has caused a wide range of its members to trade on relatively low valuations. Although their share prices could move lower in the short run due to a weak economic outlook, over the long term they may offer recovery potential.
Therefore, investors who have a long time horizon may be able to profit from low valuations that are on offer across the FTSE 100. With that in mind, here are two stocks that could be worth buying with £2k, or any other amount, today.
Berkeley Group The most recent update from FTSE 100 housebuilder Berkeley Group (LSE: BKG) was at the end of March. It highlighted the challenges being faced by the business, with its sales offices closed and many of its sites winding down their operations.
Looking ahead, the company appears to have the financial strength to overcome a period of low sales. For example, it has a net cash position in excess of £1bn. It may also experience gradually improving sales conditions as the construction industry reopens and housing transactions recommence.
Whether Berkeley Group’s financial performance will quickly return to pre-crisis levels is a known unknown. However, its share price suggests that investors have factored-in this risk. Its shares have declined by 16% since the start of the year, and could now offer good value for money.
With a solid track record of emerging in a strong position relative to its peers following previous economic crises, Berkeley Group may produce improving financial performance in the coming years. As such, the FTSE 100 company could deliver a rising stock price that makes it an attractive investment opportunity at the present time.
FTSE 100 airline easyJet (LON:EZJ) Another FTSE 100 share that could deliver a recovery over the long run is easyJet (LSE: EZJ). It announced this week that it will resume flights on some routes from 15 June. This will mainly be limited to domestic routes in the UK and France where the company believes there is sufficient demand to warrant the reopening of its services.
Of course, easyJet has faced a hugely difficult period that could last for many more months. A large part of its fleet could continue to be grounded while the company pays its costs. This could lead to an uncertain financial future for the business, although it has been able to reduce costs and access funding arrangements in recent weeks to improve its outlook.
With easyJet’s share price having fallen by 60% since the start of the year, it appears as though investors have factored-in many of the risks faced by the business. Therefore, although its prospects appear to be bleak at the present time and it is a high-risk stock, it may offer capital growth potential over the long run.
The post £2k to invest today? I’d buy these 2 cheap FTSE 100 shares after the stock market crash appeared first on The Motley Fool UK.
Peter Stephens owns shares of Berkeley Group Holdings and easyJet. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
Motley Fool UK 2020
First published on The Motley Fool
