Unfortunately, neither of these questions can be answered in a straightforward fashion. For starters, the Greek debt crisis may be over for now, but there is still a good chance that at some point further down the line the country will struggle to repay the full extent of its debts, with a haircut likely to be required. This would undoubtedly knock investor sentiment and hurt the price level of the FTSE 100, as well as hurt the balance sheets of a number of banks, both in Europe and across the globe.

Furthermore, the FTSE 100 remains at around 6,800 points and has shown little indication of a move upwards since a deal was reached between Greece and its creditors. A key reason for this is an expectation that at some point in the next six months the long-awaited move upwards in interest rates in the US and UK will commence. While this indicates that policymakers are finally convinced that the worst of the global financial crisis is over, it is likely to dampen investor sentiment since a rising interest rate makes saving more appealing, spending less appealing and generally acts as a brake on the performance of the economy.

Therefore, the short-term outlook for the FTSE 100 may be rather disappointing and investors who are anticipating a new all-time high in the second half of 2015 may be somewhat disappointed. Certainly, a major fall is now much less likely following the Greek deal, but equally a sharp rise in the index’s level seems difficult to envisage in the short run.

Despite this, now is a great time to invest in shares. For starters, the income element of total return is likely to beat anything else that has a similar (or lower) risk profile, with net yields (for basic rate taxpayers) of 4%+ being relatively easy to find. Even many utility companies are yielding more than that and, while interest rates may cause their interest costs to rise (and those of other highly indebted companies), they remain hugely defensive and solid investments for the long run.

Looking further ahead, the news for the FTSE 100 is likely to be positive. Certainly, the boom of the last handful of years may not return for a short while, since the boost from quantitative easing and an ultra-loose monetary policy is now set to finally end, but an improving global economy should mean a more gradual and sustainable rise in the index level seems to be on the cards in 2016 and beyond.

Therefore, patience looks set to be rewarded, with the next six months providing the perfect opportunity to add high-quality stocks at fair prices to your portfolio, in time for what appears to be a very bright long-term future for the FTSE 100.

The post Why The FTSE 100 Is Set To Disappoint appeared first on The Twelfth Magpie.

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Peter Stephens has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

You know, I feel sorry for the Greeks. They are a good people. It is not by chance that this was the birthplace of democracy and debate. They have a sense of what is right and what is fair. Instead of bluster, they discuss and reason about everything.

Governments must balance their budgets

Everyday there are more dramatic headlines about what is happening to this country; but this is not really about headlines. What the Greek people have been through over the past five years has been nothing short of horrific. People have lost their businesses, their jobs, their homes and their families.

Yet another bailout looms for Greece. The conditions stipulated are at least impossible. Greece’s debt is now reaching somewhere near a google. I think this is getting silly.

Linear thinking is very common. You try something; it works. You try it again; it still works. So you keep doing the same thing. But at some point it will stop working. So you stop doing it.

It is now Greece’s third bailout. The national debt of Greece is estimated to be 344 billion euros. The population of Greece is 11 million. That’s quite a lot of debt, for a small country without the economic firepower of the major nations.

How could this country be allowed to rack up such a huge credit card bill? Beats me.

And you see, the way to prevent this sort of thing is ridiculously easy: just balance your budget. Governments should not be allowed to produce budgets which are not balanced. Full stop.

Racking up debt is akin to being a drug addict. And Greece has taken so much, it is now in the emergency room. This means it now needs emergency measures. Bailouts just won’t cover it.

Greece must leave the euro

Greece has to leave the euro. It has to default on its debts. This will mean the economy will be frozen out of the debt markets — people won’t be able to take out mortgages or loans or make credit card purchases. But this is preferable to a country’s spiral into what is basically oblivion.

This has to be done as gently as possible so that it doesn’t go into shock. But it has pretty much been expecting this for the past five years. And if Europe and its banks pull together, I am hopeful there won’t be systemic effects on the global financial system, including the FTSE 100.

The country will see itself as destitute; and, to some extent, it will be. But it will get through it. I suspect it may take a decade, but Greece will improve, recover and eventually strengthen, helped by a weak drachma which will draw tourists and companies.

The world is watching this. And it should be. Because Greece must tell the world about the dangers and the horrors of debt.

The post Is Greece Leaving The Euro The Best Thing For The FTSE 100? appeared first on The Twelfth Magpie.

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To get more cash, what Greece must do by the end of Wednesday is enact legislation that will make pensions savings, raise VAT, increase the flexibility of the jobs market and accelerate the privatisation of state assets.

No haircut

In return, Greece will get another bailout of up to €86bn, which is desperately needed in order to immediately pay some of it back!

But what it won’t get is a reduction in any of its debt, even though everyone from your humble writer up to the IMF itself knows it can’t be repaid. Germany has put its foot down and would rather see Greece booted out of the euro than forgive a single cent of it (despite Germany being the European country that has had by far the most of its own debt written off over the past century).

Now, greater jobs flexibility and faster privatisation make a lot of economic sense and would help bring Greece closer to 21st-century European norms, but squeezing pensions and raising VAT will harden the austerity the Greek people are already facing, and seem to fly squarely in the face of last week’s “No” vote in Greece’s referendum — but it appears the Greek government takes its orders from Germany now, not from the Greek people.

Democracy, what’s that?

And in a further sign of the principles of democracy having been binned, prime minister Alexis Tsipras is set to get rid of opposition in his own cabinet, having already dumped the popular (in Greece, but not liked by the eurocrats) finance minister Yanis Varoufakis.

Many of us who want to see an independent Greece with a brighter future for its young people will want to see this proposal scuppered by Mr Tsipras’s opponents, and there’s still time, but what would an agreement do for European markets?

The past week’s calm is just an illusion, as a new helping of fudge will surely only delay the inevitable — Greece should have dumped the euro in 2010 when the stream of sugary confectionery was turned on. And for a short-term respite from the current turmoil, the markets of the eurozone will be paying the price of longer-term uncertainty.

Bank risk

Those who have lent money to Greece are going to face a so-called haircut sooner or later, that much is for sure. Euro-politicians need to face up to the reality of that, and investors should be careful when they invest in banks that are shouldering any significant part of it — Deutsche Bank shares have picked up in the past week, but they’re still down 11% since April, and our own HSBC and Barclays are on Greece’s list of creditors.

The post FTSE 100 Steadies After Greek Fudge appeared first on The Twelfth Magpie.

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Alan Oscroft has no position in any shares mentioned. The Motley Fool UK has recommended Barclays and HSBC Holdings. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Greece is certainly dominating the news, and creating volatility in financial markets, but is it diverting us from a more fundamental factor that has also coincided with the FTSE 100 slump?

Nobody’s talking about the downgrades in corporate earnings forecasts that have unfolded this year. When I look at how severe these have been, I’m a little surprised the Footsie isn’t lower than its current 6,673 points. The index certainly has potential to slump further, particularly if earnings estimates continue their downward trend.

The top 10 companies of the FTSE 100 account for over 40% of the index’s weight. The table below shows the percentage change — from six months ago to today — in consensus earnings forecasts for the current year and next year.

Source: calculations based on data from Digital Look

As you can see, only one of the companies — AstraZeneca — has seen the City consensus on its earnings prospects rise over the past six months. There are some pretty hefty downward revisions among the other nine. Downgrades outweigh upgrades further down the index, too. The weighted averages in the bottom row of the table might suggest a healthy 10%-15% market correction for the FTSE 100 is in order.

Winners and losers

It’s no surprise that analysts have got through barrels of red ink in marking down forecasts for Shell and BP in the face of weak oil prices. Shell’s shares have fallen 14.4% over the past six months, but earnings forecasts for the company have fallen much further. Meanwhile, BP’s shares have actually risen by 7.1% over the period. Sure, there has been some good news and reduced uncertainty on outstanding issues relating to BP’s Gulf of Mexico oil spill, but the earnings downgrades and rise in share price have combined to crank up the price-to-earnings (P/E) ratio from 10.9 to 16.3. BP’s valuation doesn’t look appealing to me at this level, and I think the shares could be vulnerable in a market correction.

Other sectors haven’t been downgraded as massively as the oil industry. But revisions to earnings forecasts for Vodafone have certainly been substantial. Furthermore, as with BP, as earnings prospects have been downgraded, Vodafone’s shares have actually risen — by 4.8%. The P/E of the telecoms group has shot up from an already-high 34.9 six months ago to 42.2 today. With Vodafone having considerable exposure to Europe, you’d have thought the launch of eurozone “quantitative easing” in the spring to stimulate economic activity might have resulted in analysts upgrading their earnings forecasts for the company. But no, forecasts have been revised down, and Vodafone’s rating looks unjustifiably high to me.

By contrast, AstraZeneca is looking an increasingly interesting proposition. The company has been revitalised under chief executive Pascal Soriot. After several years in the doldrums, which saw analyst earnings forecasts repeatedly revised down, the corner seems to have been turned, and a trend of upgrades could be starting to appear. Despite this, Astra’s shares have weakened 6.6% over the past six months. I see Astra’s current P/E of 15.4 as attractive, because the potential for further upgrades gives the shares scope to rise, and, as the market looks forward to the company returning to earnings growth, it could also command a higher P/E.

The post Forget Greece: Here’s The Real Reason For The FTSE 100 Slump! appeared first on The Twelfth Magpie.

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G A Chester has no position in any shares mentioned. The Motley Fool UK has recommended shares in GSK and HSBC. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Furthermore, this week included the first Conservative budget since 1997, with it set to have a major impact upon the financial futures of people across the UK. While much of the talk was of George Osborne positioning himself in pole position to be the next leader of the Conservatives and of the Tories occupying the centre ground, the key takeaway was that the UK’s economic future appears to be rather different to its past. Here’s why that’s a good thing.

A New Era

After a number of years of running a budget deficit, the UK looks set to finally run a surplus by the end of the current Parliament. Of course, that sentence could have been written in 2010, when the Chancellor stated that he would balance the books within five years, but the reality has been that austerity has been rather less savage than most people expected. As such, the UK is still racking up debts from the global financial crisis, with them only set to start falling in a few years’ time (if everything goes to plan this time).

This is good news for the UK’s economic prospects, since a debt to GDP ratio of around 90% is likely to prove unsustainable in the long run. Furthermore, more secure public finances are likely to impact positively on the UK economy and create improved business confidence, investment and less fear among consumers. This point, although intangible, is critical to job and wealth creation and, while the global financial crisis is still in the minds of consumers and business people across the UK, a budget surplus and falling debt level are likely to gradually turn fear into optimism and a more positive outlook for the UK economy.

Personal Finances

Of course, changes to tax credits, increased dividend taxes and other tax increases may mean that the amount of cash in people’s back pockets comes under a degree of pressure following the budget. And, while corporation tax is due to be cut to just 18% by 2020, the introduction of a living wage of £9 per hour in the same year should offset much of the savings made by businesses in the long run.

However, the upshot of these changes is a more balanced, secure and sustainable economy which should not only create jobs at a faster pace than in the past, but also provide real-terms pay rises over the medium to long term. That’s especially the case since inflation is forecast to remain relatively low and, with interest rates themselves being low, there is plenty of scope to cool inflationary pressures should they arise over the medium to long term. Therefore, when it comes to disposable incomes, growth is likely to be felt by most workers across the UK.

Looking Ahead

Clearly, there are always potential problems ahead, with the Greek debt crisis and Chinese stock market crash being two recent examples. However, such problems have always existed and the key moving forward is that the UK economy is becoming less dependent on debt, more self-sufficient, sustainable and secure. For job creation, pay rises and investment, that’s a good thing and means that, however the Greek crisis concludes, the UK is in a relatively strong position to come through it.

The post Greek Deal Or No Deal: Osborne’s Budget Is Great News For Your Financial Future appeared first on The Twelfth Magpie.

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Panicked markets

Let’s start with the basics. On April 27, the FTSE 100 closed at 7,103 — an all-time high.
 
Now, after some weeks of Grexit worries, the market is down 8%. And judging from the sea of red on my screen, it’s likely to be heading further south still.

So it’s not surprising to hear pundits speaking of panicked investors fleeing equities, and racing lemming-like into German bunds, United States treasuries, and Mongolian yak futures. (Okay — maybe not that last one.)
 
It’s predictable, to be sure. But not necessarily a profitable course of action. German bunds, for instance, currently yield 0.7% — implying for UK investors a real (inflation-adjusted) rate of return that is negative, ignoring the effect of any further depreciation in the euro.

What will it mean?

Now, let’s just put events into context. The market is down 8%, and could go further.
 
Just for the sake of argument, let’s assume a 10% fall. It might be more; it might be less — the point is that no one knows.
 
But do the events presently unfolding in Europe mean that decent, solid, British companies are going to make 10% less in profits?
 
I very much doubt it.
 
For while some businesses will find that a weaker euro makes for a tougher export market, businesses importing from the eurozone have cause for cheer.
 
And for those businesses with minimal exposure to the euro, then the overall impact is likely to be, well, minimal.

We’ve seen this movie before

Of course, with the media reporting hordes of investors fleeing equities and heading into Mongolian yak futures and heaven knows what else, it’s only natural to want to join them.
 
But why? Those of us with long memories have seen this drama play out many times before. Black Monday, the Russian debt default, the South East Asian financial crisis, the collapse of Long-Term Capital Management, the first Gulf War… the list is long, and being added to every few years.
 
But despite its length, I’ll wager that few of you recall such events in anything but the very broadest terms. Far less the fear and panic that gripped financial markets at the time.
 
And so, I’m sure, will be the case with today’s unsettled markets. In a few years’ time, it will be a huge ‘so what?’.

Traders vs. investors

The real problem for us investors, of course, is that a lot of the blame lies with sloppy media reporting, and flawed logic.
 
Let’s deal with the former, first. To be blunt: arguably, very few real investors are fleeing anything. The fleeing is mostly down to stock market traders—namely, City professionals.
 
Because for traders, switching out of asset classes is perfectly reasonable. But that isn’t to say that it’s the right thing for you and I, who are prepared to take the long view.
 

Which brings us to the flawed logic. Because investors like you and I should actually welcome such periodic waves of panic in the markets, and see them as a buying opportunity.
 
That’s right: a buying opportunity.

Nervous markets = lower prices

To see why, let’s paraphrase slightly the words of Warren Buffett.
 
Who memorably put it this way: if you’re a net buyer of stocks — rather than a net seller of stocks — should you welcome low prices or high prices?
 
Low prices, of course.
 
Because with lower prices, we can — naturally enough — buy more shares for our money.
 
Which can have a big impact on our performance. Do the maths, for instance, and you’ll see that with a 25% decrease in a company’s share price, you can buy 33% more shares — and obviously get a 33% increase in income, assuming an unchanged level of dividend.
 
And I’m certainly a net buyer of stocks — and hope to be for many years yet. You too, I’m guessing.

Pushing the ‘buy’ button

So it shouldn’t be a surprise that I took advantage of the opportunity that these market worries has presented.

On Monday morning, as markets digested the Greek ‘No’ vote, I was buying into a FTSE 100 engineering business that I’ve had my eye on—and whose shares are already down 12% from my previous purchase price.
 
And with markets seemingly set for a nervous summer, I’m hoping it will be the first of several such purchases.

The post This Nervous Market Is Making Me Greedy appeared first on The Twelfth Magpie.

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Clearly, the reason for the fall is uncertainty regarding the outcome of the Greek debt talks. At the present time, an agreement still appears to be some way off, with both sides playing hardball (in public, at least). And, as a result, it seems likely that the FTSE 100 will drift downwards the longer the situation drags on.

The question for investors is, of course, how low could the FTSE 100 go? Is a fall below 6,000 points really possible and, perhaps most importantly, is this the start of a prolonged period of share price falls following the strong bull market that occurred from March 2009?

On the one hand, the situation in Greece does not appear to be enough to push the FTSE 100 into a prolonged bear market. After all, a Greek default will be very painful for European banks and is likely to cause concern regarding their financial standing. However, on its own a Greek default is unlikely to cause a recession or bear market that is anywhere near as painful as the credit crunch.

Furthermore, the global economy is performing relatively well. For example, the US is on the cusp of interest rate rises and, while China is enduring a soft landing, it is still posting GDP growth of over 7% per year. As such, the wider macroeconomic outlook is arguably the most positive it has been for many years and, while a Greek default would lead to pressure on the global banking system, it seems inevitable that a considerable haircut will be required in order to keep Greece in the Euro. In other words, a lack of full repayment of some degree is already being priced in to stock market valuations.

The problem, though, is what happens after Greece. If it leaves the Euro then it could become a blueprint for other countries that are unhappy with the single currency project to do the same. The electorates of countries such as Spain and Italy could vote in anti-austerity political parties who have the upper hand in negotiations with their creditors, since a further break-up of the Euro would be a situation that existing members would seek to avoid. And, as ever, further uncertainty in the Eurozone would be likely to have a negative impact on consumer confidence, investor sentiment and, ultimately, the FTSE 100.

Looking ahead, a Greek default is likely to further hurt investor sentiment in the short run. And, with the FTSE 100 having shed 8% of its value in around ten weeks, a fall below 6,000 points cannot be ruled out. However, while the situation regarding Greece is a concern, such events have always been a feature of the investment world. In fact, for long term investors they present an opportunity to buy high quality companies at depressed prices.

The post Could The FTSE 100 Sink Below 6,000? appeared first on The Twelfth Magpie.

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My quick take? Short-term weakness in the FTSE 100 is an opportunity too good to pass up for savvy investors. Here’s why.  

FTSE 100 Down 

The last 10 days of trade have been revealing. 

Since 27 June, when the Greek government asked its citizens to vote on a bailout package (whose terms essentially are no longer valid), the FTSE 100 has lost 3% of value. Greek affairs are important, but they are only party to blame for its weakness — yet the same does not apply to other indexes in “Euro-land”. 

Germany’s DAX and France’s CAC 40 are flat while markets in Italy and Spain have underperformed ever since Greek lawmakers authorised Alexis Tsipras’ bailout referendum eight days ago. (The yield curves of Italy and Spain are more important than stock prices there to gauge the risk of contagion.)

But consider the last three months of trading, during which the DAX and the CAC are down 10.3% and 8.4% respectively. That compares with a -6% performance for the FTSE 100 — by far today’s best performer on this side of the Atlantic. 

Meltdown

Before the 30 June deadline — when Greece should have repaid €1.5bn to the International Monetary Fund — many UK traders had suggested a meltdown scenario, according to which the FTSE 100 could have plunged by 10% or more in the wake of a negative outcome between Greece and its creditors. 

In Europe’s bond market periphery yields have barely changed since 27 June, and it doesn’t look systemic risk has heightened in the wake of the recent “no” vote from Greece. 

It’s easy to argue now that if volatility in Europe persists — which is pretty damn likely considering the way politicians have handled the situation over the last four years — investors will look for safer options elsewhere.

Then, at its current valuation, the FTSE 100 remains the most obvious defensive play in this part of the world. 

“Peak To Trough” Research — Broker

Some of its main constituents continue to face an uphill struggle, yet you should not lose faith in the main index. 

Research published today by Exane BNP Paribas investigates the impact of different shocks for different sectors across Europe since the crisis crunch started in 2007/2008 , evaluating the performance of several equity investments. 

As one would imagine, the “average sector relative performance through Europe’s risk events” shows that the banks, insurance companies, basic resources, utilities and oil & gas clearly underperformed more defensive sectors such as food & beverage, healthcare and retail. 

The good news here is that, across the spectrum, your UK holdings may not have appreciated much in recent times, and that’s because many industries are still in restructuring mode — take miners and supermarkets. But then the shares of certain oil majors and utilities could be had at bargain prices. 

Macro

Based on the economic landscape (job market, inflation, interest rates expectations, indebtedness), signs of better times to come are evident, and the FTSE 100’s performance versus other indexes signals that investment risk is low in the UK. 

On 2 July, this headline from Reuters — “Miners and BP push Britain’s FTSE higher” — caught my attention, and that’s exactly what you’d want to see in future weeks if you are invested in the UK. 

“The real problem, though, is China, where stock market volatility has come back with a vengeance,” one senior banking source told me today.

In fact, expectations on China are going to weigh more on the FTSE than on any other indexes around Europe. 

That could be soon forgotten, however, if interest rates rise sooner than expected. 

Recent macroeconomic readings point to that direction. 

The post How The Greek ‘No’ Vote Can Propel The FTSE 100 To New Highs appeared first on The Twelfth Magpie.

More reading

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• Will SpaceX, Nvidia, or Alphabet be the first $10trn stock?
• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

Alessandro Pasetti has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

But, these shares have lagged the FTSE 100 even before Greek concerns have had much of an impact on the market. This is because the problem with these shares stem largely from their weak underlying earnings.

So, how much further can these shares fall?

Short answer: not much.

Why? These shares have become widely judged by their dividend yields. Recent earnings volatility and expectations that earnings will eventually recover have made it far more difficult to estimate the future earnings and cash flows of these companies.

Yet even as these companies do not generate enough free cash flow to cover their capital spending needs and their dividend payments, analysts believe that their dividend policies are secure, at least in the short to medium term. Their strong underlying balance sheets should provide these companies with sufficient financial flexibility to turn around these businesses and continue to afford with their dividend payments. In addition, asset disposals from these companies will reduce the pressure to raise debt too quickly in the short term.

Shell, BP and Tate & Lyle currently yield 6.6%, 6.0% and 5.4%, respectively. Back in 2009, when Brent crude oil prices fell to $40, the dividend yields of Shell and BP briefly peaked at around 8.0% and 9.5%, respectively. But by the end of the year, both shares had dividend yields of less than 6%.

Today, the price of Brent is around $62; but more importantly, equity market valuations are far stronger and average dividend yields much lower than in the immediate aftermath of a financial crisis. So, it is unlikely that the share prices of the oil majors will fall by such a large extent that their dividend yields will reach levels seen back in 2009.

Similar to the oil majors, Tate & Lyle is suffering from lower commodity prices. Lower sugar prices and supply disruptions caused by weather and manufacturing problems led adjusted operating profits to fall by 29% this year.

However, with the company increasing its focus on the modestly growing speciality food ingredients business and lowering its cost of production, a potential turnaround is in sight. This combined with the non-cyclical nature of its food business should mean that Tate & Lyle shares deserve a lower dividend yield than the oil majors.

Unlike in 2009, when the global financial crisis reduced expectations of oil demand growth; the recent fall in the oil price is primarily due to increasing global oil supply, particularly with expanding US shale production and OPEC’s unwillingness to lose market share. This combined with the weak outlook for oil demand from emerging markets means that the low oil price will likely stay low for longer.

In conclusion, though these three shares do not seem to have much further to fall, their upside prospects are also limited because of their weak earnings outlook. The dividend income from these shares are secure over the next 3-5 years, but uncertainty over their longer term prospects will continue to put pressure on their valuations.

The post How Much Further Can Royal Dutch Shell plc, BP plc and Tate & Lyle plc Fall? appeared first on The Twelfth Magpie.

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However, whether or not Greece exits the Euro, there are a number of stocks which, in the long run, offer significant appeal from a total return perspective. For example, IAG (LSE: IAG), owner of British Airways, is set to benefit from a lower oil price that may remain on offer for a number of years, according to oil industry experts.

As such, IAG’s bottom line should deliver a period of rapid growth, with earnings on a pretax basis forecast to rise from €828m last year to €2.4bn next year, which is a rise of almost three times. This could act as a catalyst on the company’s share price and, although it has already risen by 36% in the last year, there could be further gains to come.

Likewise, estate agency, Savills (LSE: SVS), continues to benefit from ideal operating conditions. Low interest rates, a weak sterling (which attracts foreign buyers to the UK) and the potential for a renewed flight to safety that saw investors pile into London property during the credit crunch, are combining to provide a stimulus to the company’s bottom line. In fact, in each of the last three years, Savills has posted double-digit earnings growth and, despite this, it trades on a very appealing price to earnings (P/E) ratio of just 16.3.

Meanwhile, more defensive stocks such as Centrica (LSE: CNA) (NASDAQOTH: CPYYY.US) and funeral company, Dignity (LSE: DTY), also hold tremendous appeal. In the case of Centrica, it has a more certain operating environment to look forward to, with the potential for a new regulator and a domestic energy price freeze having been dashed by a Tory win at the election.

Furthermore, Centrica and Dignity both offer a degree of stability and, as with London property, could become a flight to safety for anxious investors if Greece does exit the Euro. In Dignity’s case it has grown its earnings in each of the last five years, averaging 16% per annum. Meanwhile, Centrica yields 4.6% and provides a relatively clear earnings profile over the medium term.

Similarly, if Greece doesn’t exit the Euro, then Centrica’s P/E ratio of 14.6 has scope for a significant upward rerating and, in Dignity’s case, its price to earnings growth (PEG) ratio of 1.7 indicates great value – especially when its highly consistent earnings track record is taken into account. And, with demand for funeral care and domestic energy unlikely to change significantly whether Greek stays in or leaves the Euro, both Centrica and Dignity seem to offer a degree of consistency and certainty during a highly volatile period.

So, while the Greek debt crisis is undoubtedly a concern for investors, the likes of IAG, Savills, Centrica and Dignity appear to be worth buying now for the long term.

The post Grexit Or No Grexit, These 4 Stocks Are Worth Buying: Centrica PLC, International Consolidated Airlines Group SA, Savills plc And Dignity Plc appeared first on The Twelfth Magpie.

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Peter Stephens owns shares of Centrica. The Motley Fool UK has recommended Centrica. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.