{"id":429443,"date":"2026-02-16T23:47:07","date_gmt":"2026-02-16T23:47:07","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/429443\/"},"modified":"2026-02-16T23:47:07","modified_gmt":"2026-02-16T23:47:07","slug":"a-once-in-a-decade-chance-to-buy-shares-in-an-ai-resistant-ftse-100-firm","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/429443\/","title":{"rendered":"A once-in-a-decade chance to buy shares in an AI-resistant FTSE 100 firm?"},"content":{"rendered":"

\"Investor<\/p>\n

Image source: Getty Images<\/p>\n

Artificial intelligence (AI) is almost certainly creating some unusually good opportunities to buy shares. The trouble is, figuring out exactly where they are is difficult.\u00a0<\/p>\n

It\u2019s hard to know which software companies are going to be helped by AI and which are going to find themselves disrupted. Fortunately, this isn\u2019t the only place to look for discounted stocks.<\/p>\n

Distribution<\/p>\n

Bunzl (LSE:BNZL<\/a>) is a distributor of non-food consumables. That includes things like disposable tableware, cleaning supplies, and safety equipment.\u00a0<\/p>\n

There isn\u2019t much of an AI threat here. Artificial intelligence might be able to help a company automate its buying process, but it can\u2019t move physical goods to where they need to be.\u00a0<\/p>\n

Despite this, the price is down 39% in the last 12 months. But while the share price has stabilised a bit recently, it\u2019s still trading at a price-to-earnings (P\/E) ratio<\/a> of only around 12.\u00a0<\/p>\n

That\u2019s its lowest level in a decade \u2013 the average over the last 10 years has been more like 20. And it\u2019s why I think there\u2019s a huge opportunity right now that I\u2019m looking to take advantage of.<\/p>\n

Capital allocation<\/p>\n

A falling share price isn\u2019t usually anything for long-term investors to take advantage of. But in Bunzl\u2019s case, it\u2019s something that makes a difference to the underlying business.<\/p>\n

The firm\u2019s current focus is on growing through acquisitions<\/a>. And it has a very good record of taking advantage of a large and fragmented market to build a scale that few rivals can match.\u00a0<\/p>\n

With its own stock becoming cheap though, Bunzl\u2019s management now has to think about whether it can provide better value for shareholders by buying back some of its shares.\u00a0<\/p>\n

The company\u2019s recent record has involved buying businesses at P\/E multiples of around 10 or 11. So there\u2019s a real case for thinking the firm should change direction with the share price unusually low.<\/p>\n

Risks and opportunities<\/p>\n

The case for buybacks<\/a> is strengthened by the risk that comes with acquisitions. Even for an experienced firm with an outstanding record, there\u2019s always a danger of integration difficulties.<\/p>\n

There\u2019s a downside to share buybacks in that that they don\u2019t improve Bunzl\u2019s scale the way an acquisition does. This also drives value and convenience for customers and sets the company apart.<\/p>\n

That means management has a decision to make in terms of figuring out the best strategy. But I think either could create significant value for shareholders over the long term.<\/p>\n

The current plan is to invest \u00a3700m in 2026 and 2027, prioritising acquisitions in the first instance, but buybacks are also happening. If the stock price didn\u2019t change, that money would be enough to reduce the share count by 10% a year, although there are likely to be acquisitions that prevent that much of the cash being spent on buybacks.\u00a0<\/p>\n

I\u2019m buying<\/p>\n

A big reason Bunzl\u2019s price has fallen is because of problems in its North American unit. Attempting to centralise the company resulted in a loss of agility and cost it a major customer.<\/p>\n

But the firm has been quick to undo this misstep and management thinks it\u2019s on the road to recovery in 2026. If that\u2019s right, there could be a huge opportunity ahead \u2013 and I\u2019m looking to take advantage.<\/p>\n","protected":false},"excerpt":{"rendered":"Image source: Getty Images Artificial intelligence (AI) is almost certainly creating some unusually good opportunities to buy shares.…\n","protected":false},"author":2,"featured_media":429444,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[554,733,4308,86,56,54,55],"class_list":{"0":"post-429443","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-technology","12":"tag-uk","13":"tag-united-kingdom","14":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/429443","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=429443"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/429443\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/429444"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=429443"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=429443"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=429443"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}