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Some buyers have been rising more and more nervous in regards to the inventory market. It could be simple to level to that on account of the efficiency of a handful of tech shares within the US market. However whereas the London market is on a much less stretching valuation, that doesn’t imply it’s essentially low cost.
The FTSE 100 index of main UK blue-chip shares has repeatedly hit new highs up to now in 2025, in spite of everything — together with this week. So towards that backdrop, might the FTSE 100 nonetheless doubtlessly current an investor with alternatives?
Taking a long-term strategy
I feel the reply is sure. Simply because a market hits a file excessive doesn’t essentially imply that it’s overvalued (or undervalued). Not solely that, however the present worth is only a snapshot. It may be simple to pay an excessive amount of consideration to it, somewhat than asking what I feel is a extra helpful query.
That query is, as an investor, am I in a position to purchase a stake in a superb enterprise (or companies) at this time for markedly lower than I feel they are going to be value over the long run?
Taking that strategy, even when I purchased a share now and its worth then went down, it might not essentially hassle me. As a substitute, I might give attention to the truth that in the long run its worth (in my view) should be larger than it’s.
Endurance is useful in that state of affairs, in fact. If it was a dividend share, I could even be paid to attend!
Trying to find bargains at this time
So are there any FTSE 100 shares which may nonetheless be the type of share I describe above? I feel so. In any case, the index comprises 100 totally different shares. Whether or not it’s using excessive like now, or not, a few of these particular person shares might probably be bargains – and others might not.
One FTSE 100 share I feel buyers ought to contemplate in the meanwhile is brewer and distiller Diageo (LSE: DGE). The index’s robust efficiency this 12 months (up 15%) isn’t any because of Diageo, a share that has fallen 29% up to now in 2025.
There might be good causes for that. Diageo has been battling short-term challenges by way of weak demand in Latin America and elsewhere. It’s preventing a medium-term problem, of a sluggish economic system hurting tipplers’ enthusiasm for premium-priced spirits. Additionally it is grappling with the long-term development of fewer youthful customers ingesting alcohol.
Given all that, it’s simple to see why some buyers have cooled on Diageo, regardless of its huge earnings and decades-long streak of annual will increase in its dividend per share.
I feel the inventory market response might have been overdone although. Diageo has expanded into non-alcoholic drinks. That defensive transfer solely excites me marginally as an investor. What I feel stays the large alternative is booze.
The FTSE 100 firm is aware of make it and promote it. Its portfolio of premium manufacturers and distinctive manufacturing amenities resembling storied distilleries provides it pricing energy.
