We’re now halfway through August and I’m on the hunt for the best FTSE 100 stocks to buy for my long-term portfolio. Having spent some time trawling through the index, I think I’ve found two companies that may offer attractive growth and income opportunities. Let’s take a closer look.
The defensive option
Lately, shares in BAE Systems (LSE:BA) have been performing well and they’re up 29% in the past six months. Currently, they’re trading at 778p.
The aerospace and defence firm posted glowing results for the six months to 30 June. In that time, underlying operating profit grew by 8.2% to £1.1bn. In addition, the business expects full-year sales to grow between 2% and 4%.
These results follow moves by countries around the world to increase defence spending following the Russian invasion of Ukraine.
However, with supply chains already under severe pressure as we emerge from the pandemic, BAE Systems may face issues when it comes to acquiring materials to manufacture products.
On the other hand, improved results led the company to declare a 10.4p interim dividend, up 5% year over year. It’s also embarking on a £1.5bn share buyback scheme. The news prompted Deutsche Bank to increase its price target from 860p to 970p.
Back open for business
The InterContinental Hotels Group (LSE:IHG) share price has been about level over the past six months. At the time of writing, the shares are trading at 5,044p.
The hotel firm recently released positive results for the six months to 30 June. In that period, operating profit more than doubled, year over year, coming in at $377m.
In addition, revenue per available room was up 51%, but still lagged pre-pandemic levels. It’s worth noting, however, that this growth is not guaranteed in the future.
While there is of course the threat of further variants, these results are an indication that the business is recovering from the torrid time it endured during the pandemic.
Indeed, it prompted the company to declare a dividend of ¢43.9 per share. This is 10% higher than 2019 levels and is the first dividend following the pandemic.
As a potential investor, it’s exciting to know that I could derive income from holding this stock while potentially benefiting from its growth. Although I’m aware that dividend policies can change at any time in the future.
Another suggestion that the business is on a better financial footing is that its net debt declined by about 30%. This puts the firm in a better position to embark on controlled expansion.
Overall, these two companies have both recently published better results. As we enter the second half of the month, I’ve decided to add both businesses to my portfolio soon so that I can benefit from their much-improved operating conditions.