Brexit caused a major shakeup on the FTSE 100, and markets have since regained stability. The stocks that fell following the UK’s vote to leave the European Union have suffered major losses, but smart investors have been gobbling up some companies that have a solid forecast.
Buy low and sell high is the motto of many investors, and these two companies provide the perfect price for investors that follow this model.
1. Berkeley Group (LSE: BKG)
Berkeley Group suffered major losses, falling from £32.85 to £20.15 in the span of one day. The fall caused the company’s investors to sell off the stock as uncertainty in the housing and building sector mount.
The stock has recovered to £25 a share, and forecasts that the company will boost its bottom-line by £536 million by April 2018 provides some assurance for investors that Berkley will continue to perform well.
The construction industry in the UK fell its furthest in over seven years following Brexit, and this is a concern for investors in Berkeley. Companies with longer-term contracts have fared better than Berkeley since the referendum, but the company’s stock price is too favorable to overlook going into mid-August.
2. Capita (LSE: CPI)
Capita is an outsourcing firm that suffered losses following Brexit, with the company’s stock falling to 839p before rising above the 1000p mark a few days later. The company’s half-year results released in June were positive, with pre-tax profit rising by £40 million, up to £186 million in the first half of the year.
The company’s underlying revenue reached £2.4 billion, up 5%.
Management for Capita has openly discussed Brexit, putting investors’ minds at ease. The company forecasts 4% growth this year with a P/E rating of 13. The company further noted £879 million in major contract wins through the first-half of the year.
Capita also offers a 3.5% dividend payout.
