The FTSE 100 blue chip index is full of household names like BP, Barclays, Lloyds, Marks & Spencer, Tesco and Shell.
But this roll-out of multinational enterprises also contains some less well-known businesses which deserve greater fame – and far more attention from private investors. These are companies with tradition and staying power.
Their products and services may be frankly dull, but the returns that they offer can be anything but unexciting.
These unsung corporate heroes are the Footsie’s best kept secrets which may be worth digging into if you are weary of big name U.S. tech stocks and want to back British companies.
Major U.S. banks are suddenly seeing the attractions of unloved UK shares, and why should UK investors get left behind in the rush?
Undercover star: Susannah Streeter, head of money and markets at Hargreaves Lansdown, says ‘boring Bunzl’ has richy rewarded investors
Bunzl
Distribution giant Bunzl has been branded ‘boring’ – but its share price growth tells a different story.
Bunzl supplies the products to businesses that people need and use every day. These are the goods that we cannot live without – which is why, as Bunzl puts it, ‘boring can sometimes be best’.
Its range includes loo roll, food packaging, disposable cups for coffee shops and cafes, hard hats to be worn by builders – and bandages to hospitals.
The London-headquartered firm’s share price is up nearly 24pc in the last year – and analysts have predicted that it has further to go. Last year Bunzl reported profit before tax of £699 million and a 68.3p dividend per share.
Bunzl’s origins date back to 1854; this £12bn enterprise started out as a Slovakian haberdashery retailer. The company relocated to London in 1938 as Europe headed towards the Second World War.
Bunzl joined the stock market in 1957, its new status reflecting the shift in the company’s focus, from haberdashery to paper manufacturing and then to outsourcing and distribution.
Growth has been boosted by a slew of acquisitions – 210 in the last 20 years – and Bunzl now operates in 33 countries with around 24,500 employees.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: ‘Bunzl’s success shows how our need for everyday but essential items can be turned into a big flow of profitable revenue.
‘From food packaging to cleaning chemical and safety equipment, these are ordinary items, a world away from the trend-setting products sold by influencers.
‘They may sound boring, but they are goods the company’s customers can’t do without.’
Ashtead
Ashtead was founded as a plant hire company in 1947 and has grown into an international equipment company with a market capitalisation of £23.3billion.
The firm, which runs the Sunbelt Rentals brand, floated in London in 1986 but most of its business is now done in the U.S. where, among other services, it provides equipment for film making and TV production.
Indeed Ashtead has been weighing moving its listing to New York, where valuations are higher.
Investors will be keen for a management update when the FTSE 100 giant reports its first quarter results next week.
The company’s growth was dented by Hollywood strikes, but analysts still consider it to be a ‘boring’ but reliable stock pick.
Sunbelt Rentals, which is run by Ashtead
Industrial action by writers and actors, which meant there was a smaller market for Ashtead’s services on TV and film sets, has ended.
Fears of an economic slowdown in America may also have been keeping the share price subdued.
But official data last week showed the U.S. economy grew 3pc in the second quarter, faster than first reported, which helped to cool recession concerns.
Russ Mould, investment director at AJ Bell, said: ‘Shares in the plant and equipment hire specialist are yet to recapture their peak of summer 2021 and they are broadly flat over the past year, to perhaps reflect residual fears of an American economic slowdown.’
Shares have fallen more than 2pc over the past 12 months but have started to recover in 2024. Over the past two years they are up 24pc.
The market consensus is that the stock is a ‘buy’, suggesting analysts believe shares could return to a peak last seen in 2021.
Ashtead reported a profit of £1.73billion for the year ended April 30 and a dividend of 68p per share.
IMI
Formerly known as Imperial Metal Industries, IMI is a British engineering giant. Its history can be traced back to a Birmingham percussion cap factory opened in 1862, which grew to become Britain’s largest ammunitions manufacturing company. A percussion cap is a firearm ignition devices.
Over the decades it has made everything from soap to bicycle and car parts to zippers, as well as operating a laboratory for studying metals.
In the 1950s, scientists at the company – then known as Imperial Chemical Industries – discovered how to produce titanium on a commercial scale.
It listed in London as IMI in 1966 and now employs around 10,000 workers in more than 50 countries, with a market capitalisation of £4.8billion.
Last year the firm hit profit before tax of £397million and announced a dividend of 28.3p per share.
In a boost for investors, the company announced a £100 million share buyback at its half-year results in July.
Its share price is up 21.77pc over the last year, and the analyst consensus is buy.
Howdens Joinery Kitchen wholesaler
Howdens Joinery was founded in 1995 as a division within MFI, the now defunct furniture retailer.
Following a split in 2006, it became a standalone business.
The firm sells kitchens, joinery, hardware, tools and bathroom cabinets to trade customers from more than 900 depots worldwide.
In 2015, the London-based firm, which made £328million in profit last year, was given Queen Elizabeth II’s seal of approval with a Royal Warrant of Appointment.
Howdens Joinery was founded in 1995 as a division within MFI
Shares are up 31.46pc over the past 12 months, and Howdens’ market cap has ballooned to £5.2billion. It announced a dividend of 21pc per share last year.
Richard Hunter, head of markets at Interactive Investor, said the firm’s recent interim profit had been 44pc higher than the same period in 2019, which represents ‘a full recovery since all lockdowns were lifted’.
‘We view Howden as a high-quality company that is well positioned for a macro recovery in due course and, beyond that, has a clear runway of potential growth,’ analysts at Deutsche Bank said in a note to clients.
The market consensus from analysts is buy.
Weir Group
Glasgow-based engineering firm Weir Group was founded by two brothers – descendants of the legendary Scottish poet Robert Burns – in 1871.
They set up the company to supply the Clyde shipyard and the steam ships being built there.
Now the company is a supplier to the mining industry and has a market capitalisation of £5.16billion.
An employee at Weir factory, a supplier to the mining industry
In April, the specialist firm said demand for its equipment will endure as the sector pivots to more sustainable methods, as it confirmed it is on track to meet sales and profit guidance.
And last month, Barclays said growth in mining equipment is likely to be ‘unexciting’, and said Weir is likely to outperform its rivals in the market.
Last year its profits hit £411m and it declared a dividend of 38.6p per share.
Weir’s share price has jumped 9.59pc over the past year and the analyst consensus is that the stock is a buy.
Relx
Relx is one of the biggest companies on London’s stock market with a market capitalisation of £66billion, but it’s not a household name.
Its bumper valuation means the little-known data and analytics firm is worth more than both mining giant Rio Tinto and drugmaker GSK.
Relx started life as a Kent paper mill in the 19th century before growing into a conglomerate covering print, paper, paint, packaging and publishing.
The Surrey-headquartered firm listed in London in April 1948.
At one point it owned Mirror Group Newspapers, which was later sold to now-disgraced tycoon Robert Maxwell.
Now the company focuses on data and analytics and owns the LexisNexis legal and news database and runs Comic Con events.
Led by Swedish chief executive Erik Engstrom, the firm employs 6,000 people in the UK.
Shares in Relx are up more than 37pc over the past 12 months. It reported profit of nearly £2.5billion last year and a dividend of 54.6p.
The market consensus is buy, with analysts pointing out that Relx’s push into AI could unlock further growth.
Richard Hunter, at Interactive Investor, said: ‘The group’s heavy reliance on digital products is a boon on two fronts.
‘Firstly, they are largely removed from the economic cycle, giving them a defensive side and, secondly, the proprietary and specialised areas in which they operate give them something of an “economic moat” from competitors who would find the business model difficult to replicate.’
Compare the best DIY investing platforms and stocks & shares Isas
Investing online is simple, cheap and can be done from your computer, tablet or phone at a time and place that suits you.
When it comes to choosing a DIY investing platform, stocks & shares Isa or a general investing account, the range of options might seem overwhelming.
Every provider has a slightly different offering, charging more or less for trading or holding shares and giving access to a different range of stocks, funds and investment trusts.
When weighing up the right one for you, it’s important to to look at the service that it offers, along with administration charges and dealing fees, plus any other extra costs.
To help you compare the best investment accounts, we’ve crunched the facts and pulled together a comprehensive guide to choosing the best and cheapest investing account for you.
We highlight the main players in the table below but would advise doing your own research and considering the points in our full guide linked here.
>> This is Money’s full guide to the best investing platforms and Isas
Platforms featured below are independently selected by This is Money’s specialist journalists. If you open an account using links which have an asterisk, This is Money will earn an affiliate commission. We do not allow this to affect our editorial independence.
| Admin charge | Charges notes | Fund dealing | Standard share, trust, ETF dealing | Regular investing | Dividend reinvestment | ||
|---|---|---|---|---|---|---|---|
| AJ Bell* | 0.25% | Max £3.50 per month for shares, trusts, ETFs. | £1.50 | £5 | £1.50 | £1.50 per deal | More details |
| Bestinvest* | 0.40% (0.2% for ready made portfolios) | Account fee cut to 0.2% for ready made investments | Free | £4.95 | Free for funds | Free for income funds | More details |
| Charles Stanley Direct* | 0.35% | No platform fee on shares if a trade in that month and annual max of £240 | Free | £11.50 | n/a | n/a | More details |
| Fidelity* | 0.35% on funds | £7.50 per month up to £25,000 or 0.35% with regular savings plan. | Free | £7.50 | Free funds £1.50 shares, trusts ETFs | £1.50 | More details |
| Hargreaves Lansdown* | 0.45% | Capped at £45 for shares, trusts, ETFs | Free | £11.95 | £1.50 | 1% (£1 min, £10 max) | More details |
| Interactive Investor* | £4.99 per month under £50k, £11.99 above, £10 extra for Sipp | Free trade worth £3.99 per month (does not apply to £4.99 plan) | £3.99 | £3.99 | Free | £0.99 | More details |
| iWeb | £100 one-off fee (waived until Dec 2024) | £5 | £5 | n/a | 2%, max £5 | More details | |
| Accounts that have some limits but attractive offers | |||||||
| Etoro* No investment funds or Sipp | Free | Investment account offers stocks and ETFs. Beware high risk CFDs. | Not available | Free | n/a | n/a | More details |
| Trading 212* | Free | Investment account offers stocks and ETFs. Beware high risk CFDs. | Not available | Free | n/a | Free | More details |
| Freetrade* No investment funds | Basic account free, Standard with Isa £5.99, Plus £11.99 | Freetrade Plus with more investments and Sipp is £9.99/month inc. Isa fee | No funds | Free | n/a | n/a | More details |
| Vanguard Only Vanguard’s own products | 0.15% | Only Vanguard funds | Free | Free only Vanguard ETFs | Free | n/a | More details |
| (Source: ThisisMoney.co.uk July 2024. Admin % charge may be levied monthly or quarterly | |||||||
Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.
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