There is no doubt that the Covid-19 pandemic has had a significant effect on the FTSE 100 and its constituents. Some stocks have gained over the last 12 months, while many others have seen their value fall.
Looking at FTSE 100 shares, most are still trading lower than what they were 12 months ago, just as the pandemic was beginning to take hold in the UK. Indeed, 59 of the companies in the Footsie have seen their share prices decrease during that period, while the index itself is down around 13%.
There have been signs of a recovery in the last few months, however. The index has gained 26% since the onset of the crisis last March.
I think there are some FTSE 100 shares that still represent decent value for investors at the moment, including Barratt Developments (LSE:BDEV) and Unilever (LSE:ULVR)
Building recovery
One UK stock that I’m a fan of at the moment is housebuilder Barratt Developments. As with many FTSE 10o stocks, its value has slid in the past 12 months. However, it has recovered well in the short term and has a history of growth.
The share price has grown 24% over the last three years thanks to demand for houses soaring across the UK and further afield.
After the initial lockdown in March last year, further lockdowns and restrictions have been loosened for the construction sector. Barratt said it completed 9% more homes in the second half of the year than it did in the corresponding period of 2019. The company said this was a record number of completions, and helped it to see a 1.7% rise in profits during the same time.
To me that sounds like the housing market remains strong. Barratt has built a solid reputation over the years as one of the go-to housebuilding companies.
That said, we know from very recent history that the housing market, more than most, can be subject to booms and busts. Some will say that recent strong performance from the housebuilders is the onset of a bubble that will eventually burst.
I don’t subscribe to that view, however. I would add Barratt shares to my portfolio or ISA, as favourable interest rates are likely here to stay for the foreseeable future, given the wider economic uncertainty present in the UK.
Brand strength
With a history of working in the advertising industry, I’m a huge fan of companies that are able to build consumer brands effectively. That’s why I like consumer goods giant Unilever – the company behind names such as Hellmann’s and Ben and Jerry’s.
The Unilever share price dipped last week after it reported a drop in underlying operating profit of 5.8% for the year. This was worse than analysts had predicted, and Unilever will need to return to profit growth if its share price is to follow suit.
Looking deeper at the figures, however, that drop in profits was heavily affected by unfavourable exchange rates. The company also announced it was upping its dividend for Q4, so I didn’t see the trading update as negatively as the market did.
With a strong brand portfolio and the fact Unilever is investing into areas of accelerating growth, such as India, and China, I still see plenty of upside for the company and would add it to my portfolio today.