There are different ways to build wealth. One is to buy shares in proven, blue chip companies that can hopefully appreciate in value over time, and potentially pay me dividends along the way.

Some FTSE 100 stocks look like bargains to me at the moment, so I’m excited to build on this strategy in 2025!

The action isn’t economical based on price alone

What do I mean by “opportunityshares? It can be tempting to look at a penny share and think it’s cheap just because the price is listed in pennies. However, as Warren Buffett says: “price is what you pay and value is what you get“.

In other words, the price is just that. It does not indicate whether something is economical or exorbitant. To do this, we need to know what is being purchased and evaluate its value compared to the costs.

Why would this stock be a bargain?

The theory sounds all well and good. However, this may raise the question: why would a well-known FTSE 100 share be trading at a bargain price?

After all, the rest of the world can – if they want – look at financial statements and company information just like I do. So if it’s a bargain, why don’t they buy the stock and drive the price up?

There are various possible explanations and it is significant to remember that many of them are judgmental. I rate a company as being worth a certain amount, while another investor believes it is worth more or less. There may be no objectively correct answer.

To illustrate this, look at the stock price chart for AstraZeneca over the last year.

During this period, the company had good and bad moments. But objectively, was it really worth more than a quarter less at the beginning of November than it had been two months earlier? I doubt it.

Taking advantage of frail prices as investment opportunities

However, for an investor, this type of price volatility is not necessarily a bad thing. In fact, it can be great because it creates opportunities to buy proven blue-chip companies at an attractive price (what market specialists call “entry point“).

For example, one stock I think investors should consider is M&G (LSE: MNG). It has also experienced quite a bit of price volatility over the last 12 months, with prices ranging from £2.41 to as low as £1.70.

In other words, the highest price was 42% higher than the lowest price. That’s just in one year. In the long run, it has moved even further.

Are there risks that could assist explain some of the price weakness? Sure they are. For example, in the first half of last year, as part of their core business, customers withdrew more funds than they deposited. If this trend continues, profits could suffer.

Despite this, M&G has proven to be an effective generator of surplus cash. With a powerful brand, gigantic customer base and powerful demand for asset management, I believe this should continue to be the case.

This helped the company enhance its dividend. Its yield is currently 10.2%, one of the highest of all FTSE 100 stocks.