Top 3 FTSE 100 stocks to buy the dip in
- The FTSE 100 index has crashed by 7% from its YTD high.
- The Bank of England has been extremely hawkish.
- Aviva, Diageo, and HSBC are good buys.
The FTSE 100 index has crashed by over 7% from its highest point in 2022 as worries about high-interest rates and recession remain. The ongoing political crisis in the country coupled with the rising inflation has not helped. While this drop has hurt investors, it has created a good opportunity to buy quality companies at a cheaper price. Here are some of the best FTSE 100 stocks to buy in 2022.
Aviva (LON: AV) is a leading insurance and investment group that focuses on the UK, Ireland, and Canadian markets. The firm offers savings, retirement, investments, and insurance solutions to over 18.5 million people.
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In the past few years, the company has been in a turnaround phase that has seen it exit most of its international presence. Analysts believe that a smaller, focused company offers a better opportunity for strong returns.
The firm also used its disposals to improve its balance sheet, which pushed its solvency shareholder ratio from 2025 in 2020 to 244% in 2021. It used other parts of these funds to boost shareholder returns. It paid over £4.75 billion to investors through dividends and share buybacks.
Analysts have a favorable view of Aviva as interest rates rises. This trend could see the shares jump to above 500p in the coming months.
Diageo (LON: DGE) is another FTSE 100 stock worth looking at. It is a giant beverage company that owns brands like Johnie Walker, Smirnoff, Guinness, and Baileys among others. The firm sells its products across all categories like whiskey, vodka, gin, rum, beer, and wine. It also has a portfolio of non-alcoholic beverages.
The Diageo share price has dropped by about 11% from its highest point this year. There are concerns about the cost of doing business as wages and cost of agricultural products rise. Still, all these will be offset by the rising demand for alcoholic beverages as the world economy reopens. There are also signs that some prices of inputs have started retreating.
HSBC (LON: HSBA) is a large banking group that has vast operations in Europe and Asia. The firm generates most of its income in the Asian market. In the past few months, HSBC has increased its focus on the Asian market. It even moved its senior-most leaders to Hong Kong.
HSBC share price has done well this year as it has outperformed other global banks and the FTSE 100. This trend will likely continue as the Chinese economy continues its recovery. Analysts believe that the stock has a room for more upside.
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