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When we search for the best value stocks, we all need to do our own research. Our knowledge, targets, takes on risk, and all sorts of individual circumstances will be different.
But to get started, I’d say we really need to take note what the experts are saying. I’m still doing it now, even with decades of stock market experience.
It doesn’t mean we should look for people to tell us what to buy and then just do what they say. No, but I like to listen to as many opinions as I can, as it really does help me to make my own choices.
Here are a few thoughts from some of the experts out there, and how they fit with my thinking.
What they’re watching
Spread betting platform IG has Marks & Spencer down as a stock to watch in 2024.
I agree, and I’m pleased the high street giant is back in the FTSE 100. I wasn’t sure I’d ever see it happen, mind, as the firm seemed to keep repeating the same old failures.
Even after 2023’s success, the stock has forecast price-to-earnings (P/E) ratios of 10-11 in the next few years. The retail sector is still very uncertain, but I think I see good value here.
IG also likes the look of Centrica, which I confess I’d taken my eye off. But after a recovery from a pretty bad 2022, the shares are on a modest valuation now. We do have a dip in earnings on the cards for 2024, though.
Yum-yum
People often say we should buy what we know. And I’m in Greggs enough times each week to surely have some idea about it.
Fidelity has it down as a possible pick for 2024. And the bakery chain has come through the past few tough years pretty well.
Inflation is coming down, but it’s still a risk. And on a P/E of around 19, the shares aren’t obviously cheap. Still, cheap and good value aren’t always the same thing.
Property
Rightmove is on the Fidelity list too, and it’s one I’ve also been watching. Property market weakness must be the biggest risk. But that could change when interest rates start to come down.
Interactive investor has uncovered Tritax Big Box as a possible winner. It’s a real estate investment trust (REIT), focusing on logistics facilities.
The shares have picked up a bit, but forecasts make it look good value to me. Commercial property still looks a bit risky, but there could be decent dividends here too.
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Small cap
Finally, in an interview, small-cap expert Simon Thompson reckoned smaller stocks could be in for a good year.
He offered Billington Holdings as a candidate. It’s a structural steel maker with a market cap of only £58m, and there might be a bit of volatility there. The valuation isn’t stretching, though, and it might do well when the construction industry recovers.
New Year’s resolution for me: spend more time researching small-cap stocks,