The stock market has crashed! 3 things I’d watch out for when buying FTSE 100 shares now

first_img 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. Simply click below to discover how you can take advantage of this. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Our 6 ‘Best Buys Now’ Shares See all posts by Peter Stephens The FTSE 100’s recent fall could prove to be a buying opportunity for long-term investors. The index has always recovered from its various crises and bear markets to post new highs. This can sometimes take time, of course. But long-term investors can benefit from buying a diverse range of shares while they are cheap.Indeed, through buying companies with sound finances and strong market positions while they trade on low valuations, you could capitalise on the FTSE 100’s recent crash. Over the long run, you could generate high returns which improve your financial prospects.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…Sound financesWhat is the most important consideration to make when buying shares at the present time? I think it is whether the business in question will survive the upcoming economic challenges. In the UK, and in many countries, restrictions on people’s movement are in place. This will cause challenging trading conditions for a wide range of businesses. And it could mean that their sales are significantly lower than they otherwise would be.As such, it is logical to focus your capital on companies which have modest debt levels and strong free cash flow. Moreover, making sure they can afford their debt interest payments with severely reduced sales could be a sound move. And with many companies having banking covenants in place, ensuring they have sufficient headroom to comply with their covenants could be a good idea. It may mean they have a higher chance of overcoming short-term challenges to capitalise on the prospective recovery in the coming years.Strong market positionsCompanies with strong market positions could benefit from the current crisis. For example, they may be able to expand their market share due to present challenges affecting their peers to a greater extent.Therefore, investors may wish to focus on companies which have wide economic moats. This could mean they have strong brand loyalty, lower costs than their rivals, or a unique product, for example. They may be better able to not only survive an economic slowdown, but to recover from it once restrictions on people’s movement are lifted.Low valuationsThe FTSE 100’s recent fall means that most stocks are now trading at significantly lower price levels than they were just a few months ago. However, as always, some stocks appear to offer better value for money than their peers.This may not necessarily mean that they have the lowest valuations. Rather, it could be that their valuations are more attractive than their peers based on the quality of their business models. In other words, the cheapest stocks may not necessarily be the most attractive when their outlooks are taken into account.Through buying good quality businesses while they trade on attractive valuations, you could generate high returns in the long run. The FTSE 100 may not recover quickly, but its track record shows that a bull market is likely to be ahead over the coming years. Image source: Getty Images. Peter Stephens 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 “This Stock Could Be Like Buying Amazon in 1997” Peter Stephens | Thursday, 26th March, 2020 | More on: ^FTSE Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! Enter Your Email Address 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. 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