The previous few weeks have been turbulent within the inventory market and that has thrown up what I regard as some nice shopping for alternatives. One FTSE 100 share I had been eyeing for some time got here down to a price the place I made a decision to purchase it for my Self-Invested Private Pension (SIPP).

Priced for uncertainty

The share in query is advert company group WPP (LSE: WPP). With its world community and heavy dependence on client promoting, the unsure financial outlook has raised the danger degree for the corporate, in my opinion.

In the meantime, the position of synthetic intelligence (AI) continues to be tough to foresee. It’s already seeing some conventional promoting spend disappear – however would possibly it additionally assist companies like those WPP owns, by slicing labour prices?

Both means, the enterprise faces probably powerful instances. In a buying and selling replace final week (after I purchased the share for my SIPP), it introduced that reported income for the primary quarter fell 5% year-on-year. It referred to a “challenging” macro-environment.

It’s maybe little shock then, that the WPP share price has fallen 31% to date this yr.

Meaning it’s now simply 4% larger than 5 years in the past. Throughout that interval, the broader FTSE 100 index is up by 46%. In relative phrases, WPP has been an absolute canine.

Heaps to love, not least the price

Why then, did I add it to my SIPP when there are different bargain-looking buys obtainable from the blue-chip index amid the present market turmoil?

The yield appeared juicy, at 6.9%. However whereas that’s effectively forward of the FTSE 100 common, dividends are by no means assured to final.

WPP shareholders don’t should be informed that, because the agency’s payout per share was sharply lowered through the pandemic and has by no means received again to its former degree.

It’s the supply of the dividends that pulls me. The promoting market might face uncertainty nevertheless it has performed so many instances earlier than. WPP is among the huge gamers with a deep shopper roster, massive set of capabilities, world footprint and confirmed enterprise mannequin.

I feel all of this helps stand it in good stead. In its buying and selling assertion, it mentioned that it has not but seen any vital change in shopper spending following US tariff bulletins. It additionally affirmed its full-year steering.

In actuality, I feel it’s too early to inform with certainty how the enterprise will fare over the subsequent 9 months. However clearly administration stays assured – and WPP has a number of what it takes to do effectively as a enterprise.

Set in opposition to this, I feel the share price fall has been overdone. The share now trades on a price-to-earnings ratio of 12, which I discover enticing for a enterprise of this high quality.

In the meantime, if the dividend is maintained, proudly owning the share might add some extra passive earnings to my SIPP, able to compound by investing in different cut price blue-chip shares or probably extra WPP ones.