Investors watched transfixed as the SpaceX (NASDAQ: SPCX) stock soared past $200 after its record-breaking IPO on 12 June. And they’ve been equally transfixed as (to give it its full name) Space Exploration Technologies Corporation shares plunge just as quickly.

It’s been quite the spectacle. Especially as it created the world’s first trillionaire in Elon Musk, then robbed him of that status within days.

Today, SpaceX shares trade around $153. The market-cap is still a stunning $2trn but the US tech sector is on a knife edge. There’s a fresh concern about the artificial intelligence (AI) revolution, which may turn out to be inflationary, as Apple hikes prices on iPads and Macbooks by up to $300 to cover the cost.

Is now the time to be wary of big tech?

SpaceX’s own AI division, xAI, is burning through cash. While its Starlink satellite internet division generates recurring revenue, it also requires heavy investment, and its 10,000 satellites erode quickly due to their low orbit. 

SpaceX posted a $4.9bn net loss in 2025. In Q1 2026 alone it lost $4.28bn. We have no timeline for when it becomes profitable.

Musk’s venture has vast horizons and is arguably the most ambitious and exciting company on the planet. It will also benefit from a wall of money coming from index tracking funds over the next few weeks. But as always, with great opportunity comes great risks. Right now, this one’s too risky for me.

As investors get nervous about AI generally, I’m looking at companies that are making money today, and there are plenty of those on the FTSE 100. Like Asia-focused bank HSBC Holdings (LSE: HSBA). And it’s definitely making money – with profits of $29.9bn in 2025. It made another $9.38bn in Q1.

Half-decade profits have been climbing at a fair old lick too, as this list shows:

• 2025 – $29.9bn
• 2024 – $32.3bn
• 2023 – $30.3bn
• 2022 – $17.1bn
• 2021 – $18.9bn

The 2025 dip doesn’t worry me too much. That was mostly due to one-off items such as restructuring, legal provisions and asset sales.

Can HSBC shares keep climbing?

The HSBC share price has had a stellar run. It’s up 60% in the last year, and a staggering 250% over five. Frankly, if SpaceX posted that kind of growth from here, we’d all be raving about it.

HSBC may struggle to maintain that pace of growth. The Chinese economy has been shaky, with concerns about its property and shadow banking sector. The board has paused its generous share buyback programme to fund the $13.7bn acquisition of Hong Kong’s Hang Seng Bank.

Beijing has just placed curbs on wealthy mainland Chinese using Hong Kong banking services, potentially hitting demand for HSBC’s services. So there are risks here too. Yet I’ve bought its shares in both May and June.

Today, the HSBC share price looks reasonable value with a forward price-to-earnings ratio of 11.6. Unlike SpaceX, there’s income on offer too. HSBC’s forecast to yield 4.46% this year, rising to 4.98% in 2027. I’ll consider buying even more HSBC shares in the weeks ahead, but will tread carefully around SpaceX.

Should you invest £5,000 in Space Exploration Technologies Corp. - Class A right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Space Exploration Technologies Corp. - Class A made the list?

Harvey Jones owns shares in HSBC Holdings.

The post Up 250%! Here’s why I bought HSBC shares over SpaceX stock appeared first on The Twelfth Magpie.

More reading

• Is SpaceX on my list of shares to buy in July?
• Dear SpaceX stock fans, mark your calendar for 7 July
• The SpaceX frenzy is over – is it time to look at Rolls-Royce shares again?
• Why 11 August could be a key date for SpaceX stock
• How much might £19,999 in a Stocks & Shares ISA be worth by 2036?

The news is all about surprises, and the Diageo (LSE: DGE) share price has just delivered a big one. It’s climbed. As in, gone upwards. I’ve barely seen the like, at least not for some time.

It isn’t exactly a huge jump. Just 3% in a week. But I almost fell off my chair. I was beginning to think shares in the FTSE 100 spirits giant only went one way, and that was the wrong one.

Diageo shares have crashed 55% over the last five years. While a handful of FTSE 100 stocks have done worse, they didn’t have the scale and clout of this one. Diageo was always seen as one of the UK’s most impressive and reliable companies. Few expected it to take this sort of beating.

Why is this stock climbing?

But that’s investing for you. History shows equities outperform almost every other investment over the long term, but in the short term anything can happen. Diageo is a reminder of why it’s wise to hold a diversified portfolio of shares. If one goes wrong, the others can hopefully compensate.

Diageo shares were hit by falling sales across several key markets, starting with Latin America & the Caribbean, then spreading to the US and China. Its strategy of pushing into the premium end of the spirits market backfired, as the cost-of-living crisis has forced drinkers to trade down. US tariffs delivered another blow.

Two other trends threaten it. Younger generations are drinking less, and GLP-1 weight loss drugs may reduce appetite for alcohol. Despite all these problems, I’ve considered Diageo to be in deep value territory for around 18 months. The price-to-earnings ratio is down to 12.6. That’s roughly half its level in the glory days.

I’ve averaged down on this stock several times, only to watch it fall further. But I still believe Diageo can turn things around. So is the last week just a blip, or will the party finally get going?

Can the blue chip continue to grow?

The trigger was a major upgrade to a Buy rating, with brokers coming round to my view that Diageo is too cheap to ignore. Like me, they’re pinning hopes on former Unilever and Tesco veteran Sir Dave Lewis to deliver a recovery.

Drastic Dave has now set out his stall, and it’s the predictable one: cutting costs, reducing headcount, and improving efficiency. He’s also targeting younger, mass-market drinkers with canned cocktails and similar products. I’m curious to see how that plays out, because I’m not convinced it will deliver the scale of turnaround Diageo needs. At least he’s giving it a shot. Geddit?

The last week may just be a blip. I’ve waited for the recovery for so long that I might be overreacting. But one thing hasn’t changed. I still think Diageo is worth considering for long-term investors prepared to wait. Whether it ever becomes the blue-chip hero of yore is another question. So it’s good news, but I’m not getting carried away. We’ll need a lot more of it before the shares really kick on.

Should you invest £5,000 in Diageo Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Diageo Plc made the list?

Harvey Jones owns shares in Diageo.

The post Newsflash: the Diageo share price just climbed! appeared first on The Twelfth Magpie.

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Investors love Nvidia (NASDAQ: NVDA) and with good reason. The shares are up a stunning 840% in the last five years. I hold a small position myself, and only wish I’d bought more.

This is the ultimate picks-and-shovels stock, selling the chips and infrastructure that power the artificial intelligence boom. Unlike many companies spearheading the AI revolution, it’s also making big profits, at an accelerating pace.

• 2025 – $72.9bn
• 2024 â€“ $29.8bn
• 2023 â€“ $4.4bn
• 2022 â€“ $9.8bn
• 2021 â€“ $4.3bn

Despite that, I wouldn’t buy Nvidia today. Nor would I buy Space Exploration Technologies Corporation, aka SpaceX. Elon Musk’s venture has stellar prospects yet reportedly lost nearly $5bn in 2025. Instead, I’m looking for opportunities much closer to home.

Could AI spending become a problem?

I’m wary of Nvidia because investors are still working out whether the costs of the AI revolution will outweigh the benefits. The investment is enormous, and the returns uncertain. If companies spend hundreds of billions building AI infrastructure but customers don’t pay enough for it, today’s valuations could plummet. Nvidia would inevitably be swept up in that.

Talk of a crash may prove overdone. US tech has proven to be pretty resilient. Today, Nvidia doesn’t look outrageously expensive with a price-to-earnings ratio below 30, but I don’t think this is the moment to rush in. It’s a different story with Barclays (LSE: BARC). I’m itching to buy it.

I’ve been on a FTSE 100 bank buying spree recently, snapping up NatWest Group and HSBC Holdings in May and June. I thought they were too cheap to ignore. I think there’s space in my portfolio for Barclays too.

Why do I prefer Barclays right now?

Barclays shares have behaved almost like a tech stock, rising 50% in a year and 197% over five. Reinvested dividends will have lifted the total return towards 220%. Despite that, it still looks good value, with a modest forward P/E ratio of just 9.7. That’s comfortably below the FTSE 100 average of 16.

Profits have been rising steadily, although the pace of growth may seem somewhat sluggish compared to Nvidia.

• 2025 – Â£9.1bn
• 2024 â€“ £8.1bn
• 2023 â€“ £6.6bn
• 2022 â€“ £7.0bn
• 2021 â€“ £8.4bn

Many investors buy UK banks for the dividend income, but Barclays prefers to reward shareholders through share buybacks. Despite that, it’s forecast to yield 2.96% this year, rising to 3.63% in 2027. Barclays plans to return around £15bn to shareholders between 2026 and 2028, through a combination of the two.

Shadow banking remains a concern. Barclays recently took a £228m impairment charge from the collapse of UK shadow bank Market Financial Solutions, and more could follow. It also has exposure to volatile global markets and investment banking. If the AI boom turns into a bubble and bursts, banks won’t escape the damage. Higher interest rates could also squeeze mortgage demand, while falling rates could pressure net interest margins.

Yet Barclays is at the top of my watchlist, and I’ll seriously consider adding it to my portfolio the moment I have spare cash. Nvidia is on my list too. But I’ll wait to see what the next few weeks brings.

Should you invest £5,000 in Barclays Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Barclays Plc made the list?

Harvey Jones owns shares in Nvidia.

The post Up 50% in a year! That’s not the only reason I’d consider buying Barclays over Nvidia stock today appeared first on The Twelfth Magpie.

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The Cash ISA is hugely popular. Too popular, in my view. While it’s a great home for short-term savings and an emergency cash buffer, this is no place to build long-term wealth for retirement. For that, the Stocks and Shares ISA will do a much, much better job.

And it’s not just me saying that. The Treasury agrees. That’s why it’s planning to cut the Cash ISA allowance for the under-65s from £20,000 to just £12,000 next April. The Stocks and Shares ISA allowance will remain at £20k for all. Why is it doing that? To encourage more people to access the long-term wealth building capacity of stock markets.

Do equities really outperform cash?

Over the last decade, the average Cash ISA paid just 1.21% a year, financial website Unbiased says. By comparison, the average annual return on a Stocks and Shares ISA, with dividends reinvested, was 9.64%.

So £20,000 saved in the average Cash ISA would be worth £20,242 after one year. In the average Stocks and Shares ISA, it would grow to £21,928. That’s £1,686 more. I’ll admit that’s a slightly daft comparison. Over such a short time scale, the Stocks and Shares ISA could go anywhere. It could easily rise or fall by up to 20% or more. Cash won’t.

That short-term volatility is a price worth paying given the long-term wealth building firepower that shares bring to the table. Over the typical investment lifetime of 30 years or more, the difference is massive.

Given the above performance figures, the Cash ISA would turn £20,000 into £28,690. But the Stocks and Shares ISA would absolutely transform it into £316,301.

A popular way to invest is to buy a spread of FTSE 100 stocks, which offer both share price growth and dividend income. Insurer and asset manager Legal & General Group (LSE: LGEN) now offers the highest trailing yield on the entire blue-chip index, a stunning 7.6%. Any share price growth is on top of that. I bought it for my SIPP three years ago.

Do Legal & General shares have growth potential too?

Those dividends should ideally be reinvested while you’re of working age, to build your position, then drawn as income in retirement to top up your State Pension and any other savings you may have.

That dividend income should rise over time, which will help to protect its value against inflation. Over the last 15 years, Legal & General has increased its dividends by an average rate of 10.7% a year. This isn’t guaranteed though. The company has to generate enough cash to do that.

Sadly, Legal & General shares have disappointed lately. In fact, they trade at similar levels to a decade to go. But there are signs of a pick-up. Over the last year the shares have grown 12.7%. Combined with that trailing yield, the total one-year return is more than 20%.

Legal & General operates in a tough and competitive market. If we suffered a wider stock market crash, that could hit the value of the £1.2trn worth of assets it holds, reducing fee income. No stock is without risk. Yet I think the ultra-high income and the prospect of a share price recovery makes it worth considering today.

Should you invest £5,000 in Legal & General Group Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Legal & General Group Plc made the list?

Harvey Jones owns shares in Legal & General Group.

The post Here’s why I bought this 7.6%-yielding FTSE 100 dividend stock instead of saving in a Cash ISA appeared first on The Twelfth Magpie.

More reading

• How much would you need in a Stocks and Shares ISA to match the State Pension?
• Here’s a quick and easy way to start earning passive income this summer with a spare £1,000
• How much would I need to invest in these FTSE 100 dividend gems for a £29,061 ISA passive income?
• £500 buys £173 shares in this 7.7%-yielding income stock!
• Why boring is often best when targeting a second income from the stock market

I’ve been keeping a watchful eye on a struggling UK dividend share with huge recovery potential. Now it’s starting to move.

The company is FTSE 100 housebuilder Barratt Redrow (LSE: BTRW). Like pretty much every other UK housebuilder, it’s had a torrid decade. I decided the negativity had gone too far, and the stock was starting to look good value again.

But first, let’s look at why it’s done so poorly.

Why has this UK blue-chip struggled?

Barratt Redrow shares are down 60% over five years, and 36% in the last 12 months. Interestingly, this mirrors the performance of other UK big builder peers, including Persimmon and Taylor Wimpey, which have all been hit by factors entirely beyond their control.

The sector sold off heavily after the shock 2016 Brexit vote. More recently, it’s been hit by resurgent inflation, which has driven up mortgage rates and made UK property even less affordable. The end of the Help to Buy scheme in 2023 then snatched away a key plank of buyer support.

In a further blow, FTSE 100 and FTSE 250 housebuilders have also had to fund a remediation bill of more than £3.5bn to make their cladding safe following the Grenfell Tower disaster.

On the plus side, the Bank of England started cutting interest rates from August 2025 as inflation fell, and more cuts were expected this year. Spirits and share prices rose, but then the Iran war drove the oil price and inflation back up.

Today, markets are betting on some kind of Middle East resolution. As a result, the Barratt Redrow share price jumped 11.25% in the last week.

That makes it the third fastest growing stock on the FTSE 100. It was beaten only by Segro, the subject of a takeover bid, and 3i Group, which posted some upbeat results. There were no results from Barratt Redrow. This was purely down to market sentiment, as investors decided its shares were potentially undervalued.

Can the Barratt Redrow share price continue to recover?

If the Middle East situation calms, and oil prices and inflation retreat, mortgage rates should fall too. There’s talk of inflation falling back to 2% next year, which might revive buyer demand and prices. Investors are keen to get in early.

Barratt Redrow shares still look decent value, with a forward price-to-earnings ratio of just 11.6. The trailing yield is stunning 6.23%, but a word of warning: the board has cut shareholder payouts, and the forecast yield for 2026 is notably lower at 4.87%. That’s still above the FTSE 100 average of 3.3% though.

Last week’s jump could prove yet another false dawn. The sector has seen more than its share of those. Building homes in this country isn’t easy, due to planning rules and labour shortages. The Employer’s National Insurance hike and two large Minimum Wage increases have squeezed margins. The London market is struggling.

I think Barratt Redrow is worth considering with a long-term view, but a word of warning: any recovery is likely to be bumpy.

Should you invest £5,000 in Barratt Redrow right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Barratt Redrow made the list?

Harvey Jones owns shares in 3i Group and Taylor Wimpey.

The post This beaten-down FTSE 100 dividend share just jumped 11% in a week but still yields almost 5% appeared first on The Twelfth Magpie.

More reading

• £1,000 buys 380 shares in this 5.4% yielding passive income stock
• Down 33% with a 5.6% dividend yield, is this FTSE 100 stock a once-in-a-decade buy?
• Why are these FTSE 100 growth and dividend stocks so cheap?
• Down 65% but yielding 6.7% – is this beaten-down UK stock now a generational bargain?

As the world rearms, BAE Systems (LSE: BA) shares have reaped the rewards. So has fellow FTSE 100 defence stock Babcock International Group (LSE: BAB). But lately, they’ve gone into retreat. The stocks have slumped 14% and 20% respectively in the last three months. They’re now down 4% and 16% over the last year. What’s going on?

Rolls-Royce (LSE: RR) is a more complex beast. It has a Defence division, but that only generates around a quarter of its earnings. Roughly half comes from its Civil Aerospace arm, and the rest from its Power Systems division.

That’s helped the Rolls-Royce share price maintain its forward momentum. It’s up 22% in the last three months, and 50% over the last year.

The defence dip may shock many investors, who thought that given the state of the world, investing in weapon-makers was a one-way bet. So what caused it?

What just hit these top FTSE 100 stocks?

First, sentiment has been hit by rising hopes of some kind of peace deal in Iran. That conflict, along with the one in Ukraine, also suggests that warfare is changing. Cheaper kit like drones may now have the edge over more expensive hardware such as tanks, frigates and fighter jets. This could lead to a huge shift in demand.

Profit-taking has doubtless played a part. After a strong run, BAE systems and Babcock were trading on price-to-earnings (P/E) valuations of up to 28. Many investors may have decided a lot of good news was baked into the stocks.

Again, Rolls-Royce is slightly different. It’s P/E topped out at at a stratospheric 65. It has potentially huge new opportunity in small modular reactors, or mini-nukes, with government-interest growing worldwide. CEO Tufan Erginbilgic claims this has the ability to double Rolls-Royce’s market cap, although there’s plenty of cost and execution risk before we get there. Its Power Systems division is also benefiting from the artificial intelligence revolution, and the global spread of energy-hungry data centres. That may have offset and defence concerns.

Is this a defence sector buying opportunity?

The Rolls-Royce P/E has slipped but it’s still a gravity-defying 48. I’d suggest investors proceed with caution at these levels, although they might consider drip-feeding money in, or staying alert for any dips.

Despite the recent retreat, BAE Systems and Babcock aren’t exactly cheap. Their P/Es hover around 24. Both are successful, profitable companies, with healthy order books that give high earnings visibility for years ahead.

Both also have risks, of course, as they rely on government spending. And while the West is rearming, governments are strapped for cash. We’ve seen the political arguments play out in the UK lately.

Yet I think the recent dip may be an opportunity for long-term investors who feel they’ve missed out on the defence stock boom to consider Babcock and BAE Systems. I wouldn’t call it the perfect time, but if tempted, drip-feeding may be the best option.

Should you invest £5,000 in BAE Systems right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if BAE Systems made the list?

Harvey Jones owns shares in BAE Systems and Rolls-Royce Holdings.

The post Is now the perfect time to buy Rolls-Royce, Babcock and BAE System shares? appeared first on The Twelfth Magpie.

More reading

• Here’s how much I think Rolls-Royce shares will be worth by the end of 2027
• Could small modular reactors take Rolls-Royce shares to the next level?
• The SpaceX frenzy is over – is it time to look at Rolls-Royce shares again?
• Here’s what’s already happened to £5,000 invested in Rolls-Royce shares in January
• Here’s how Rolls-Royce shares, SpaceX, and the AI trade are all connected — and what it means for investors

Investors have been dazzled by Rolls-Royce (LSE: RR) shares ever since they took off after the pandemic. That’s hardly surprising, with the stock up an astonishing 1,220% in five years. That would have turned a £10,000 investment into a staggering £132,000.

That’s wonderful for investors who got in early but a problem for latecomers. Have they left it too late?

The answer is brutal and obvious. Yes. Rolls-Royce is now worth £110bn, and simply can’t keep growing at the same breakneck pace. Attention has drifted away, while US tech stocks have swung back into favour.

Is SpaceX just more exciting?

Much of that was driven by another potential high-growth opportunity, Elon Musk’s Space Exploration Technologies Corporation, or SpaceX (NASDAQ: SPCX). It’s dominated headlines either side of its record-breaking IPO on 12 June.

The share price was set at $135 but quickly rocketed past $200. As many writers on The Twelfth Magpie warned, the shares probably overshot on all the hype. And so it proved. The SpaceX share price fell 13% last week, although it’s still above its launch price at around $153.

Will it fall further? Maybe not. A wall of money is still waiting to go into SpaceX from passive exchange traded funds.

Personally, I think investors should approach with caution today. SpaceX is pouring money into its artificial intelligence arm xAI and posted a $4bn loss in the first quarter of 2206. Is AI a bubble or a generational opportunity? Right now, we just don’t know.

Rolls-Royce was riding high earlier this year when its price-to-earnings (P/E) ratio hit a dizzying 65. I was urging caution then too.

The shares slumped almost 20% in March, as the Iran war threatened international travel, especially in the Middle East. That was bad news because aircraft engines still generate around half of group revenues. Its Defence arm should have benefited, but that sector has also cooled after a strong run.

While SpaceX has streaked across the investment firmament, the Rolls-Royce share price has clicked back into gear. It’s up 22% in the last three months. The P/E has retreated to 46, but that’s still expensive. This is a company that has repeatedly set ambitious targets under CEO Tufan Erginbilgic, and usually matched or smashed them. It’s on course to post profits of up to £4.2bn this year.

So what do the experts say?

Consensus analyst forecasts put Rolls-Royce on a one-year share price target of 1,438p. If correct, that’s modest growth of 2.5% from today’s 1,406p. However, 16 out of 20 analysts still label it a Strong Buy, with not a single Sell recommendation.

By contrast, SpaceX forecasts look far more exciting, with a target price of 242.5p. If correct, that’s growth of 58% from today’s 153p. Five out of 11 brokers name it a Strong Buy. Two say Sell.

Forecasts aren’t guaranteed. Some SpaceX predictions may reflect the excitement around the IPO, while Rolls-Royce targets may need updating after its latest rise.

My view? Both are stunning companies but investors considering them should approach with caution. There’s just a little too much hype and hope baked in

Should you invest £5,000 in Rolls-Royce Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Rolls-Royce Plc made the list?

Harvey Jones owns shares in Rolls-Royce Holdings and the Scottish Mortgage Investment Trust.

The post The SpaceX frenzy is over – is it time to look at Rolls-Royce shares again? appeared first on The Twelfth Magpie.

More reading

• Is SpaceX on my list of shares to buy in July?
• Dear SpaceX stock fans, mark your calendar for 7 July
• Up 250%! Here’s why I bought HSBC shares over SpaceX stock
• Here’s how much I think Rolls-Royce shares will be worth by the end of 2027
• Could small modular reactors take Rolls-Royce shares to the next level?

What’s better than a high-yielding income stock? One that also happens to be dirt cheap. FTSE 100 housebuilder Persimmon‘s (LS: PSN) both. So is it worth considering today?

If you know anything about housebuilding sector, you’ll know it’s had a terrible decade. The seeds of negativity were set after the financial crisis, when interest rates were slashed almost to zero and held there for years. That drove house prices to unaffordable levels, squeezing many first-time buyers out of the market.

Housebuilders were then on the frontline of a string of shocks, starting with Brexit in 2016. The post-pandemic inflationary crisis, which sent mortgage rates to the skies, and the scrapping of the Help to Buy scheme in 2023 further squeezed young buyers.

Why has this share done so badly?

As if that wasn’t enough, hikes to Employer’s National Insurance and the Minimum Wage drove up labour costs, and the post-Grenfell cladding forced builders to shell out hundreds of millions in fire safety measures.

There was a brief respite as the Covid ‘race for space’ and stamp duty cuts briefly fired up house prices. The Persimmon share price peaked at 3,160p in May 2021. Today, it’s around 1,134p. That’s a peak-to-trough drop of almost 65%. It may also be a buying opportunity.

Plenty of investors will baulk at buying such a troubled stock. They’re wise to be cautious. While it’s great to buy cheap shares, the recovery can take a lot longer than you might like. Persimmon, like the rest of the housebuilding sector, has been swimming against the tide for years.

I topped up my stake in FTSE 250 housebuilder Taylor Wimpey at the start of this year, because I expected the property market to go gangbusters as interest and mortgage rates continued to fall. The Iran war wrecked that. But there are signs that some kind of Middle East peace deal may hold, and oil supplies are getting through. The International Energy Agency has even talked of a glut in a year or two. Inflation could finally fall below 2% next year. A word of warning: I thought the same in January. Didn’t happen.

Is Persimmon still making money?

But I still think there’s an opportunity here for investors willing to accept some volatility. Despite its share price struggles, Persimmon remains a profitable company. Last year, pre-tax profits actually rose 13% to almost £446m, beating expectations of £440m.

That followed a couple of torrid years though:

• 2025 – £445.6m
• 2024 – £395.1m
• 2023 – £351.8m
• 2022 – £703.7m
• 2021 – £973.0m

Building houses in the UK isn’t easy, given planning restrictions, and despite government promises doesn’t look like getting any easier. The economy’s struggling, the cost-of-living crisis is far from over, and buyers are strapped for cash.

But with a forward price-to-earnings ratio of 11.1, and forecast yield of 5.51% for 2026, Persimmon’s starting to look exciting. I think it’s worth considering, for long-sighted investors who are up for the challenge.

Should you invest £5,000 in Persimmon Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Persimmon Plc made the list?

Harvey Jones owns shares in Taylor Wimpey.

The post This 5.5%-yielding income stock’s at a 13-year low and cheap to-boot! Time to consider buying? appeared first on The Twelfth Magpie.

More reading

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The BP (LSE: BP) share price has offered comfort and solace throughout recent stock market volatility.

When much of the FTSE 100 took a tumble due to the war in Iran, the oil and gas giant had other ideas. Its shares climbed instead, as investors anticipated a surge in revenues and profits courtesy of rising oil and gas prices.

On 28 April, BP duly delivered. Q1 results revealed a 40% jump in underlying operating profit to $6.3bn, blasting through the $5.9bn expected. Oil trading revenues flowed, as customers battled to secure supplies with the Strait of Hormuz closed.

Q1 ended on 31 March, so the real rewards from the rising oil price won’t appear until its Q2 results, due on 4 August.

How well has this FTSE 100 stock done?

With Brent crude spiking at $118 a barrel on 29 April, the only way for BP shares appeared to be up. But there was one concern.

Whenever Donald Trump hinted at peace in Iran, the BP trade moved the wrong way. Markets rose, BP fell. Investors duly noted, and resisted the temptation to drive its shares too high. In retrospect, that looks like a wise move.

Today, Brent crude trades at around $72 a barrel. That’s a drop of 46%. BP shares have fallen too. They’re actually down almost 18% over three months. Loyal investors won’t be complaining too much. They’re still up 30% over the last year, with some juicy dividends on top. The trailing yield is 5.2%.

All stocks go through their ups and downs. Short-term volatility is the price investors pay for the long-term outperformance of equities. BP has gone through more than most. The oil price plunged to a low of $24 a barrel in March 2020 during the pandemic, and peaked at around $112 in May 2020, due to the Ukraine oil shock. Its shares broadly followed suit.

Does the downturn start now?

If the Middle East settles down, both the oil price and BP could have a lot further to fall. The International Energy Agency has forecast a massive global oil supply glut by 2027, as peace unlocks stranded Gulf crude. 

The IEA projects that global production will surge by 8m barrels per day to 110m, while demand will recover by just 2m. Welcome news for motorists and the global economy, but bad news for BP shares.

They look decent value today, with a forward price-to-earnings ratio of just 7.3. The forecast yield is 5.38%, so with luck the income should keep flowing. But I’m wary of buying the stock today. I’m not expecting a brutal sell-off, as I think prospects of peace and that IEA forecast should be priced in. But I wouldn’t be surprised to see the shares continue their slide.

BP is a cyclical stock, and won’t be down forever. Even with the climate crisis, the world will still need oil and gas. So, it’s still worth considering. I’ll prepare to take advantage of any bigger dips further down the line.

Should you invest £5,000 in Bp P.l.c. right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Bp P.l.c. made the list?

Harvey Jones owns shares in BP.

The post Just how bad could it get for the BP share price? appeared first on The Twelfth Magpie.

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What do you call a top dividend stock that’s generated plenty of share price growth as well? Ideal! Certainly as an investment idea, and I may have found it in FTSE 100 wealth manager M&G (LSE: MNG).

I had a good feeling about it when I added it to my Self-Invested Personal Pension (SIPP) three years ago, although that doesn’t really mean anything. I had a good feeling about Diageo, which I bought at the same time, and it’s been far from ideal.

Happily, I went big on M&G, and have been amply rewarded. But it is still worth buying today?

Why am I happy with this FTSE 100 stock?

At the time, M&G had one obvious attraction. It was an income behemoth, with a 10% yield. I was really keen to lock into that, but had one obvious concern. Was the dividend sustainable?

High yields are often a sign of a struggling share price. If the company struggles to fund the outsize payout, dividends cuts may follow.

Yet M&G looked okay to me. It only floated in 2019, after being spun off from FTSE 100 insurer Prudential, and early share price performance was a bit patchy. That actually tempted me, because the price-to-earnings (P/E) ratio was in single digits, suggesting value.

As a new company it didn’t have much of a dividend track history. But it did appear to have the capital strength to keep funding those dividends. So I took the plunge.

I was lucky with my timing. My online SIPP shows the M&G share price is up 63% since I bought it. So far, I’ve received six dividends and reinvested every single one. Once they’re included, I’ve doubled my money. The shares are up 25% over 12 months.

And these are very early days. I hope to hold the stock for three decades, not just three years. But investing isn’t all fun and games. At some point the M&G share price will inevitably slow or fall. Today, it’s a lot more expensive, with a trailing P/E of 26. However, the forward P/E is a more modest 13.9, which suggests earnings should climb nicely in 2026.

Is that stellar yield secure?

Alas, today’s buyers won’t bag a double digit yield. However, the stock is still forecast to year 6.25% this year. Management plans to increase shareholder payouts by a modest 2% a year going forward.

Adjusted operating profits before tax have been solid, but nothing to write home about:

• 2025 – £838m
• 2024 – £837m
• 2023 – £797m
• 2022 – £529m
• 2021 – £721m

M&G operates in a competitive market. As an active fund manager, it also has to fend off the threat from cheaper index-tracking exchange traded funds (ETFs). It generates hefty fees from commission on the assets it has under management, which will fall if we get a stock market correction or crash.

The board also has to keep generating lots of cash to pay those dividends. Happily, it still has capital strength in spades, with an exceptionally high Solvency II ratio of 242%, I don’t expect the shares to continue their strong run at today’s price, but still think M&G’s well worth considering for income-focused investors.

Should you invest £5,000 in M&g Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if M&g Plc made the list?

Harvey Jones owns shares in Diageo and M&G.

The post This stunning FTSE 100 dividend stock just doubled my money in 3 years – time to buy more? appeared first on The Twelfth Magpie.

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