Cheap shares: I’d buy this quality stock that has missed the November bounce

first_img Image source: Getty Images. “This Stock Could Be Like Buying Amazon in 1997” Cliff D’Arcy | Monday, 23rd November, 2020 | More on: RKT I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Cheap shares: I’d buy this quality stock that has missed the November bounce I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! Cliffdarcy has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.center_img See all posts by Cliff D’Arcy The last three weeks have been very positive for UK investors, with shares rising pretty much across the board. Since October, the FTSE 100 has surged in response to various pieces of good news. On Monday, the Footsie was around 770 points (13.8%) ahead in November, its best month for many a year (and heading for a monthly record). Some beaten-down cheap shares in the FTSE 100 have surged dramatically in November. Indeed, there are 23 FTSE 100 shares up by 20% or more over the past 30 days.Of course, a rising tide doesn’t necessarily lift all stocks. Some cheap shares in quality companies have been left behind in this surge. At the other end of the FTSE 100 are 22 laggards whose share prices have actually fallen over the past month. Here’s my favourite among these FTSE 100 stragglers.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…These cheap shares have missed the recent rallyIf you haven’t heard of Reckitt Benckiser (LSE: RB.), then I expect you’re familiar with many of its consumer brands. Reckitt Benckiser (RB) is a powerhouse in FMCG (fast-moving consumer goods). These are the staples that we buy to line the shelves of our bathrooms and kitchens. RB’s most popular UK brands in hygiene, health and nutrition include Cillit Bang laundry detergent, Clearasil skin cream, Dettol and Lysol disinfectants, Durex condoms, Finish dishwasher tablets, Gaviscon for heartburn, Harpic toilet cleaner, and painkiller Nurofen. All are market-leading products in their own right, with millions of us buying them for our homes. Yet RB’s cheap shares have been overlooked in the recent market mini-boom.At Monday’s close, RB’s stock stood at 6,550p a share. This values this successful Anglo-Dutch corporation at £47.7bn, making it a FTSE 100 heavyweight. However, RB’s share price has been far higher this year, hitting a 52-week closing high of 7,960p on 29 July. Since reaching this peak, RB’s cheap shares have declined by 1,410p (17.7%). To me, this seems crazy, because the underlying business has been going great guns in 2020. After all, RB does make leading household cleansers and detergents, sales of which have soared due to Covid-19.Reckitt Benckiser is crushing Covid-19Furthermore, RB’s cheap shares have slipped 450p (6.4%) since 23 October, underperforming the wider FTSE 100 by a wide margin. I find this surprising, given its latest results. In the third quarter, RB reported record sales growth of 6.9% and forecast a double-digit improvement in revenue growth for 2020. All this extra hand-washing and sanitising boosted RB’s quarterly sales to £3.5bn. However, sales of contraceptive devices, personal-care products, medicines, and formula milk did lag behind the wider group.RB is having a record year, but analysts worry that sales of cleaning products will slip post-coronavirus. I’m not so sure, as I see Covid-19 precautions lasting at least into 2022. With a price-to-earnings ratio of around 20 and an earnings yield of roughly 5%, these are not cheap shares in the conventional sense. Then again, a dividend yield of 2.7% a year that is set to grow should interest income investors.In summary, quality doesn’t come cheap — and Reckitt Benckiser stands out to me as a great British success story. Therefore, I would happily buy it today, ideally inside an ISA, to enjoy years of solid, tax-free dividends and future capital gains. 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