After steep falls, these FTSE 100 shares look dirt cheap to me

With one day to go, March has been volatile for UK investors. During the past month, the FTSE 100 the index has lost 3.7% of its value – and even with a near-4% rebound over the past two weeks.

Across the Atlantic, the S&P 500 the index actually rose 1.9% over one month. Again, this follows a 5%+ recovery from March lows. Therefore, it is natural that, after a positive start in 2022, volatility surprised investors this month.

The rise of FTSE 100 stocks

Over one month, 24 stocks in the Footsie have increased in value. This increase ranged from 0.2% to 12.8%, with an average of 3.4%.

This leaves 76 losers. The decline of these laggards ranged from 0.1% to 23.5%, with an average loss of 7.4%.

Of course, some FTSE 100 stocks have fared worse than others. Here are the five biggest flops of the month, based on Thursday’s closing price:

Price plunges across these five flops range from almost six to nearly a quarter – all in the space of one month. And while these two shares have gained in value over the last 12 months, only one eked out a positive result over half a decade. Ouch.

One thing that stands out is that four of these five fallers have been hit by heavy shudders in the banking world. After the collapse this month of three mid-sized US banks and the Swiss giant Credit Switzerlandproperty, insurance and banking shares have been beaten down the world.

Which stocks should I buy today?

If I had to choose one of these stocks to add to my family’s portfolio today, I would think long and hard. But I suspect my answer is the Big Four banks Barclays (LSE: BARC).

Last Friday, shares in Blue Eagle bank dived to just over 130p a share. At the time, I kicked myself that I had less cash to spare to buy more Barclays shares. My husband bought these FTSE 100 shares for his portfolio last July.

Even after this week’s rebound, this stock still looks cheap to me. Here’s the basics:

At the current depressed price level, Barclays shares trade at a low of five times earnings. This translates into a bumper earnings result of 21%.

What’s more, the bank’s dividend yield of more than 5% per year is protected more than four times by the final yield. While I have no doubt that Barclays is set for a tougher 2023 than 2022, I see this as a wide margin of safety for long-term investors like myself.

Finally, as the UK economy weakens, bank debt and loan losses will rise. Therefore, I predict that bank earnings will drag down this year. Even so, I see this FTSE 100 stock as a steal at the current price!