Over a 25-year period, this amount, invested at the 8% rate of return the FTSE 100 has managed in recent decades, would produce a portfolio of around £87,700. A 5% yield would give you an annual income of around £4,300, a welcome addition to a state pension. When compared with the cash savings equivalent of £30,000 over the same period, the advantages of investing via an ISA are obvious. 

What is a Stocks and Shares ISA?

I’ve noticed some confusion around ISAs, but they’re far simpler than many people think. An ISA isn’t an investment in itself. It’s a tax-efficient wrapper. In the case of a Stocks and Shares ISA, it’s a wrapper for an investment account. The advantages to investing through one are twofold. Firstly, your dividends are tax-free, and secondly capital gains tax isn’t paid on any shares you sell.

Like any other stocks and shares investment, the value of your ISA will ebb and flow with the stock market and your choice of securities. This is why it makes sense to invest in stocks and shares for the long term. However, unlike many other investment accounts, such as a SIPP or high-interest cash savings account, you can make withdrawals from your ISA at any time and without a penalty. This means you always have access to emergency funds should you need them.

I think the best ISAs are those where you can choose whatever you want to put into them, rather than one that limits you to only picking funds from the company providing it. This is mainly because I like the flexibility of choosing my own shares and changing my investments to suit me, and not the fund provider. 

So, what should I put in it?

Assuming I can pick my own stocks for my ISA, I like dividend stocks. The reason for this is the compounding benefit you get from reinvesting the dividends. In addition, the FTSE 100 currently offers many shares with dividends with 5%+ yields, far in excess of anything we’ll get in a cash account, even in a high-interest one. GlaxoSmithKline (LSE: GSK) is one example, currently yielding around 5.7%. A variety of such stocks will help protect investments from any losses too.

Moreover, with vaccines for Covid-19 on the way, it’s hoped that the economy will begin to grow again. Shares yielding dividends may have the future financial strength for increases in yields, improving returns even more.

Obviously, the more money you can invest per month, the better your nest egg is likely to be. But, even investing £100 per month in a Stocks and Shares ISA will make a difference and is a great way to maximise your potential returns throughout 2021. 

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Rachael FitzGerald-Finch owns shares of GlaxoSmithKline. The Motley Fool UK has recommended GlaxoSmithKline. 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.

However, short-term stock price swings are very hard to interpret. Factors outside a firm’s control can make a large difference to a share price. This is in sharp contrast to the long-term trend when price movements generally reflect the performance of the underlying business.

So, how does this apply to Glencore?

Glencore share price drivers

Over the last 10 years, Glencore’s share price has been underwhelming, returning a negative 54.6% in comparison with the Footsie 100’s positive 170%. Generally, it’s a firm that appears to continually weigh down the index. This is despite producing a higher-than-industry average return on equity (ROE) of 10.6% over the last five years. It appears to manage its shareholders’ funds better than the average miner. But, it’s not enough to drive increased demand for its stock over time.

Things were different back in August 2020 when the mining behemoth posted a fall in its half-year profits, blamed on the Covid-19 pandemic. It also reported a 12% increase in net debt and a conditional return to paying a dividend in 2021. Investors took this news in context and reacted positively. As a result, the firm experienced a short-term spike in demand for its stock.

However, no further financial results are due until next spring, so I think it’s a valid assumption that the recent share price take-off is due to external factors alone. This potentially leaves the future Glencore share price vulnerable to outside events.

Although this situation is true of all companies, it is an externality magnified in a mining firm’s revenues as they are dependent on commodity prices. Coincidently, copper prices are at a seven-year high. As a key commodity for Glencore, this should reflect well in the firm’s share price. In addition, China, one of Glencore’s biggest markets, is now back to business after the Covid-19 shut-down. It has a renewed appetite for raw materials, stimulating demand for Glencore products once again.  

Is Glencore a good buy?

The current Glencore Xstrata share price is hovering around 241p. Given the net asset value per share is around 222p, that’s a lot of business for your money. By comparison, Rio Tinto shares are currently selling for twice the net asset value. This makes Rio relatively more expensive by this metric.

The future also bodes well for Glencore as it’s positioned itself well for the energy transition from fossil fuels to renewables. Its key products of copper, nickel, and cobalt are used in batteries and infrastructure. In addition, competitors such as Rio Tinto are to divest out of coal but Glencore is holding steady and preparing to mop up any additional demand created. That said, the firm has also agreed to net-zero carbon emissions by 2050 by reducing its coal production. 

Although the recent share price rise is likely due to external events, Glencore is well-positioned for the future. And despite the price rise, I think the stock is still relatively cheap. 

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Rachael FitzGerald-Finch owns shares of Glencore. 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.

So, whatever 2021 has in store, I think the following five shares are some of the best dividend stocks on the FTSE 100 for future returns right now.

1. GlaxoSmithKline

Well established, defensive stocks such as GSK are always a must for my portfolio whatever the state of the stock market. Paying a consistent quarterly dividend of 19p this year, despite the share price drop, Glaxo’s expected yield sits around a juicy 5.7%. The pharma giant also boasts a large portfolio of marketed products, giving it a competitive advantage with respect to its peers. Moreover, I think the firm is undervalued right now as investors focus on AstraZeneca and its potential Covid-19 vaccine. 

2. BAE Systems

BAE Systems, with its strategic plans closely aligned with growth in global defence spending, is another stable dividend payer. The long-term nature of defence contracts mean the expected 4.6% dividend yield is likely highly sustainable throughout 2021 and beyond. It could be one of the safest dividend stocks on the Footsie. And with a dividend cover ratio of around 2.0, BAE currently has no problems in paying it.

3. Unilever

Consumer goods giant Unilever is another long-term purchase. Indeed, its steady share price has grown around 60% over the last five years. With fingers in many pies, so-to-speak, Unilever produces goods that people use every day, from soaps and other cleaning products to tea. This means that demand for the firm’s offerings is real and consistent. Indeed, it’s product branding it second-to-none, leaving peers in its wake. Who doesn’t recognise brands such as Knorr and Dove?  

4. Reckitt Benckiser

Reckitt is another FTSE 100 stalwart with well-known brands, such as Dettol, Calgon, and Nurofen. Currently trading around £65, Reckitt is pulling back from its post-summer slump. This is likely due to excellent results so far this year. Indeed, I think the market for hygiene products is likely to keep growing in the near future, leaving Reckitt well-placed to capitalise on it.   

5. Royal Dutch Shell

Oil companies have had a hard time this year, and Shell is no exception. However, last week it was one of the FTSE 100’s best-performing stocks, likely due to a climbing oil price and the news of multiple potential Covid-19 vaccines. However, Shell also leading the fossil fuel market in the conversion to renewables, the oil major aiming for net-zero emissions by 2050, and despite a dividend cut this year, a commitment to increase it going forward.  

2021 is not far away and we don’t know what the future has in store. But, there are things we can do to protect investments from any potential volatility. Adding UK dividend stocks to a well-balanced portfolio is one such method. I think the five shares listed here are a good beginning. If you disagree, there are others out there, you just need to look.

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Rachael FitzGerald-Finch owns shares of GlaxoSmithKline and Royal Dutch Shell B. The Motley Fool UK has recommended GlaxoSmithKline and Unilever. 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.

What if the price is at the top of another peak? What if people don’t accept Bitcoin as mainstream currency? What if… ? What if…? So many questions. Although many of these may also apply to FTSE-listed companies, unlike firms, Bitcoin has no intrinsic value. So, its price is based purely on the quantity of it demanded, meaning my chance of making any money, let alone a million, is based on others believing it’s worth more than I do. And at current prices, surely there can’t be that many? But, I’m guessing. 

Consequently, if I could choose how to invest £10k, I’d forget the Bitcoin price and look elsewhere for something less risky.

Forget premium bonds too

If some of my friends had £10k to invest to try and make a million, they tell me they’d stick it into NS&I Premium Bonds. Premium Bonds are the UK’s biggest savings scheme where the monthly interest due to you, the saver, is determined by a monthly prize draw. Moreover, you won’t lose your money, rising inflation notwithstanding.

The top prize is £1m. Not bad interest if you can get it. And therein, lies the problem. The chance of winning this amount of interest on one £1 premium bond is 1 in 48,733,655,950. By comparison, the probability of winning the lottery is a much better 1 in 45m. 

So, Premium Bonds are definitely less risky than Bitcoin but they’re also unlikely to make me that million. There must be a better way. 

How to invest £10k? The FTSE 250

Alternatively, I could invest in FTSE 250 firms. Over the last five years, the index has produced a return of around 14%. If it carries on like this, I could put £10k in a tracker fund, wait about 35 years and voila! My million. Or, I could add a little each month to the initial £10k, hopefully resulting in making a million sooner.

Investing in a company is not like buying Bitcoin. You’re putting money into a real entity that produces something useful, like food, clothing, or vaccines. You can also assess each firm on how it’s doing relative to its peers and give it a monetary value. You can access information to help you make these judgements, lowering your risk of losing money.   

After emerging from a stock market crash, and with the promise of a Covid-19 vaccine, FTSE-listed firms should be anticipating generating real revenues once again. Increased revenues often mean larger profits and the prospect of good returns, whether from income or capital gains. It’s a great time to invest. So, forget Bitcoin. I’m putting my £10k into firms on the FTSE 250 to make a million.

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Rachael FitzGerald-Finch has no position in any of the shares mentioned. 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.

However, don’t give up hope, because I think that not only is it possible to accumulate that nest egg, but it may be easier than you realise.

No savings? Start with a Stocks and Shares ISA

The first thing to do is to get a Stocks and Shares ISA.  These tax-efficient wrappers are a bit like self-storage for investments. Choose your provider, apply for your ‘container’, in the form of the ISA wrapper, then fill it up with investments. These investments are now protected from both income and capital gains tax. And you don’t pay tax on dividends either, provided you hold them within the ISA, even as a higher rate taxpayer.

So, you can build up your savings without having to worry about tax liabilities. And with a Stocks and Shares ISA, your money is not taxed on withdrawal. Moreover, setting up a direct debit each month drip-feeds a regular amount of money into your account so eventually you don’t even notice you’re investing.  

Invest in the FTSE 250 to retire rich

The FTSE 250 has returned a gain of 2.8% on share prices over the last five years. This is by comparison with the FTSE 100‘s 0.2%. Over the last 10 years, the returns are 10% and 1.2% respectively. This is why I like the Footsie 250. Yes, it can be slightly more volatile, but the returns are better. And over time, these add up.

Indeed, at the 10% rate, a saving of £500 per month for 26 years to take you to State Pension age, will accrue to around £655,000 yfor our retirement. If you really want to push the boat out, I calculate that for around £764 per month, you could be a millionaire by the time you’re 66.

However, this does assume that you make some good investments. One of the ways to do this is with a tracker fund to mirror the performance of the index. Alternatively, the above figures I’ve used don’t take into account any dividends. Ploughing dividend payments back into an ISA is always a good idea to make the most of your investments. It’s increasing the amount you have invested over time in a way that doesn’t increase your monthly outgoings.     

If you’ve let the past 20 years roll by with no savings, that doesn’t mean you have to continue in the same way. I think you can retire rich by getting a Stocks and Shares ISA, putting a little away each month and investing in the FTSE 250.

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Rachael FitzGerald-Finch has no position in any of the shares mentioned. 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.

But I’m not fooled by the high numbers, because things are not all that they seem with the Evraz share price.

The uncertain market for steel 

Admittedly, Evraz is one of the world’s biggest steel producers. The integrated nature of its business means it’s involved in all aspects of steel production from mining coal and iron ore to selling steel products. This enables it to deal with the cyclical nature of the steel industry more effectively than operating in only one part of it.

However, Evraz is mainly reliant on demand for its steel in Russia, the rest of Eastern Europe and North America. In all three regions, demand for its products has dropped. Consequently, operating profits plunged by 38% in its 2019 results. And this was before the global pandemic-related economic shutdown pulled its share price further into the depths.

Indeed, I suspect it’ll be a while before Evraz sees demand significantly improving again. Moreover, the bullish period around 2018 looks like an outlier, correlating with high steel and vanadium prices.      

Evraz share price fundamentals

Incredibly, the 12.3% forward dividend yield on offer is what remains after Evraz’s dividend cut in August following a poor first half-year performance. This was blamed on “restrictive“ government measures being imposed in many of its geographic markets, causing steel prices to drop. To help cash flow, it also reduced it payouts from four times per year to two.

Although the dividend yield remains relatively high, the recent cut appears to reflect the current state of the business. Declining revenues have resulted in Evraz upping its levels of debt to see it through the recent downturn. Moreover, even with the cyclical nature of the steel industry, an 80% gross gearing ratio is substantial. It illustrates the large amount of debt on the balance sheet as a percentage of shareholder funds. If the downturn continues, this may increase even more.

However, the business coverts profits to cash efficiently. But it appears that Evraz uses debt, in addition to the hard cash generated, to fund its whopping dividend. Moreover, I think the business is used as a cash-cow for its shareholders. In the short term, this could benefit an investor, but it’s not a long-term wealth-building strategy for either the business or a shareholder.

In summary    

To look at its last financial year in isolation, Evraz appears to be doing quite well. However, it’s the general trend of the business over the last few years that concerns me. Despite the cyclical nature of steel production, as I said, the most recent peaks appear to be outliers.

In addition, its debt pile is a concern and I’m not convinced it will manage to hold its showboating dividend at current levels. If demand for its products doesn’t improve, limited revenues mean the debt will have to be serviced by shareholders. Consequently, I’m looking out for less risky stocks than Evraz to add to my portfolio. 

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Rachael FitzGerald-Finch has no position in any of the shares mentioned. 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.

Stock market crash history

The worst-case scenario for many people is obviously a stock market collapse. The market for shares crashed in 1929 because of an unsustainable share price boom. In 2008, many people took loans they couldn’t afford. And the last stock market crash in 2020 was due to a global economic shock, meaning share prices were highly inflated relative to predicted future earnings. Consequently, stock prices dropped fast.

Whatever the reason for a crash, I think how well our portfolios recover afterwards is as much about the shares we’ve avoided buying as it is about shares we’ve bought. After all, investing is as much about avoiding losses as it is about making gains.

On that note, I think these are the last two shares I’d want to own if there’s another stock market crash around the corner. 

AstraZeneca

Big biopharmaceutical firm AstraZeneca is overpriced, in my opinion. Its share price has risen steeply since mid-2018, and it received an extra boost early this year due to investor optimism about its potential Covid-19 vaccine. Even if this is successful, AstraZeneca has agreed not to profit from a vaccine during the pandemic. Although, what this means in practice is anybody’s guess.

However, my concern is more with the firm’s balance sheet, which doesn’t appear to reflect the positive share price trend. A gearing ratio of 108% means the company’s debt is higher than its shareholders’ capital, despite an extortionately high share price, of around 8,614p. Moreover, high gearing has been the case for at least the last four years. To add to the money worries, it’s funding many of its dividend payments from reserves, not operational profits. Unless AstraZeneca has some serious profits in the pipeline, this doesn’t bode well for shareholders for the future. And the higher the share price goes, the harder it falls.      

HSBC

HSBC is a big bank. This is a statement of the obvious but its large market capitalisation, as the consequence of its share price, has implications for the FTSE 100. HSBC is one of only five companies that make up about 32% of the index. This means that if the Footsie is undergoing a stock market crash, then HSBC is likely driving it. To illustrate the point, over the last six months, HSBC has lost 16% of its value when compared with the Footsie’s 3%. 

In addition, lower interest rates and adverse market conditions are impeding growth for many banks. But, HSBC also has to contend with additional operational burdens in Hong Kong and the apparently deteriorating relationship between the US and China. The lack of a dividend on offer from the bank wouldn’t help an investor’s portfolio recovery either.    

I think it’s always wise to ensure one’s portfolio can receiver from the worst-case scenario of a stock market crash. I like to do that by avoiding expensive shares and diversifying away from those that have a heavy index weighting. There are many great options out there. 

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Rachael FitzGerald-Finch has no position in any of the shares mentioned. The Motley Fool UK has recommended HSBC Holdings. 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.

Dividend stocks are a great way to build wealth for an ISA. The combination of tax-free returns and passive income is a potent combination for many income investors. Two Footsie dividend stocks that appear to me to offer good returns currently are pharmaceutical giant GlaxoSmithKline (LSE: GSK) and tobacco firm, Imperial Brands (LSE: IMB). But I’d only buy one of them.

A quality dividend stock: GlaxoSmithKline 

The hunt for a Covid-19 vaccine makes pharmaceutical firms a favourite for many income investors. In addition, the defensive nature of these stocks means they’re a good choice for difficult economic times since healthcare products are always in demand. Moreover, GSK has brand leaders in all of its markets, giving the firm a large advantage when compared with its peers. 

Offering a juicy dividend yield of 5.9%, and dividend cover of 1.5x earnings, Glaxo’s return is attractive and likely sustainable. However, I’d prefer a slightly higher dividend cover figure, around 2x for complete peace of mind. Notably, Glaxo didn’t cut its payout this year, unlike many other FTSE dividend favourites. 

Currently selling around 1,356p, Glaxo is trading at a good price, I feel. Indeed, some analysts have given the stock a fair value of around 1,800p. Consequently, I think this is a bargain price for a quality stock with a relatively impressive return.

Imperial Brands 

Big tobacco is often a preferred dividend stock to buy for many income investors. Selling around 1,244p at the time of writing, Imperial offers an outstanding trailing dividend yield of 16.6%! Amazingly, this is after recent cuts to its dividend, meaning that this eye-popping yield is a consequence of people selling the firm’s shares. 

And there’s a reason for that. Despite a reputation as a defensive stock, the tobacco industry has had its fair share of problems recently. Vaping was supposed to be an alternative market to tobacco, but in the large US  market, government regulation is impeding Imperial’s growth.

In addition, it has dividend cover of only 0.5x earnings and a large amount of debt on its balance sheet. This makes me wonder whether the dividend yield can be sustained. The headwinds facing the company may well prevent any potential for capital gains for a while too. Subsequently, I’m not adding Imperial to my ISA.          

Dividend stocks are a great way to build wealth, but the dividend needs to be sustainable. I think GSK offers this quality and I’ll happily increase my holdings. Imperial Brands, on the other hand, despite the crazy yield, is less attractive. I won’t be buying it because I think there are better opportunities for wealth-building out there. 

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Rachael FitzGerald-Finch owns shares of GlaxoSmithKline. The Motley Fool UK has recommended GlaxoSmithKline and Imperial Brands. 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.

This went along with the high-end watch retailer releasing positive news about the business. Its full-year revenues are expected to be at least £40m higher than previously thought, and earnings (EBITDA) up by 1.5%.

However, we’re only 23 weeks into the firm’s financial year. And as we’ve seen recently, a lot can happen in the remaining 29 weeks. Further economic shutdowns can change a trading environment considerably, especially for cyclical stocks like WOSG. Nonetheless, it’s good news for the company and its shareholders who are optimistic about the firm’s prospects. But is a little positive news a good reason to become a shareholder now? 

In short, I don’t think so. Buying WOSG stock at its current price is gambling with your money.

The WOSG share price

The stock is currently trading around 403p and on price-to-earnings ratio (P/E) of about 2,020. This P/E ratio even exceeds Tesla‘s highest-ever P/E ratio of 1,152. Curiously, both stocks are currently trading around a similar level of pricing too.

However, as a young tech stock, you’d expect Tesla to have a relatively high P/E ratio. The company is not yet profitable and the optimism apparent in its share price should, in theory, reflect the growth expectations of the company as it tries to redefine how we live.        

As a seller of watches and jewellery, WOSG is in a completely different situation. Its plans for growth currently focus mainly on bricks and mortar, although it has also been growing its online offerings. This is likely due to the type of luxury goods it sells where the shopping experience and branding is a large part of the sale. Purchasing a Patek Phillipe from a plush store while being fawned over by a refined but eager sales assistant is a far cry from buying a mass-produced watch from an online retailer to arrive in the post on a later date.

With the physical high-end shopping experience, revenues per sale may be much higher, but so are the overheads. This adds friction to the future growth rate of the FTSE 250 retailer and I can’t see how the growth rate of the firm can be anywhere near that of Tesla’s.  Quite frankly, even if WOSG’s earnings more than double, as Goldman Sachs expects them to do, the P/E is still too high to provide a satisfactory return on my money.

What I’d do

There are many excellent FTSE-listed companies out there selling at far more sensible P/E ratios and that may also provide dividend income, improving my total investment returns. 

If I already owned Watches of Switzerland shares, I’d be selling them and cashing in on those returns. As I don’t, I won’t be buying, at least not until the stock returns to a more sensible price. Until then, there are far better options for investment returns out there for smart investors.

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Rachael FitzGerald-Finch has no position in any of the shares mentioned. 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.

This sale will, of course, depend upon shareholders approval. But I think this is likely to be given. After all, shareholders have known for some time that this spin-off was in the pipeline. Weir management is keen to streamline operations and focus on its core business of supporting global mining operations.

So, with all this in mind, is now a good time to buy Weir’s stock? Well, it all depends…

Weir Group share price forecast

Historically, divestitures are generally good for investors. The share prices of parent companies often perform well and most of my own research suggests that most sell-offs increase shareholder wealth. Consequently, an immediate rise in Weir’s stock price upon the sale announcement was always likely.

However, some academic studies have also shown that’s it’s not uncommon for divesting companies to undervalue the asset up for sale. But in this case, Weir’s oil and gas division provided the firm with a £372m pre-tax loss in 2019, on top of a £546m impairment charge. And with low oil prices denting demand for pumping equipment, it’s likely that the financial profile of the division no longer complements its mining business. Moreover, this situation would likely increase costs, damaging profits further.

I’m not convinced the energy equipment maker is in a position to wait for a higher bidder. But, I’m expecting a volatile share price as investors weigh up whether £313m is a good price for the oil and gas division.        

Other factors to consider

At the current price around 1,483p, Weir Group is selling without a valid price-to-earnings ratio. This is because its 2019 earnings, and indeed its five-year average earnings figure, is negative. In other words, over the last five years, Weir Group has not made an overall profit. As an investor, this is a big red flag for me and makes its current selling price very expensive.

However, a major reason earnings per share were negative in 2019 was due to a write-down of oil and gas assets. And in the first half of this year, its oil and gas division saw a 48% drop in revenue and an operating loss of £4.4m.

From this perspective, the sale of this division is good news. Weir will use the cash to pay off debt and enable the group to move forward as a “focused, premium mining technology business“. Management is relying on growing demand in harvesting essential metals sustainably and efficiently. As its core business, this bodes well for the future and I suspect this optimism is what caused the explosion in Weir’s share price yesterday.

However, as I’m not already an investor in the firm, I think I’ve missed the short-term opportunity for any capital gains relating to the sale of its oil and gas division. Indeed, Weir’s stock is now too expensive for me.

Yet once the sale has gone through, Weir Group is well-positioned for the future and I’ll consider it again when the price settles down. But for now, I think there are other investments out there that may provide better returns.   

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Rachael FitzGerald-Finch has no position in any of the shares mentioned. The Motley Fool UK has recommended Weir. 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.