Centrica is a UK-based company that specializes in the supply of gas and electricity. It has several household names under its belt – including British Gas, Direct Energy, and Spirit Energy.
The firm is listed on the London Stock Exchange, so you can buy its shares with ease. All you need to do is find a reputable online broker, deposit some funds, and choose how many stocks you wish to purchase.
In this guide, we show you how to buy Centrica shares online in the UK. We guide you through the end-to-end investment process, explore the best UK brokers to consider, and take a brief look at where Centrica shares are headed in the near future.
- 1 Step 1: Find a UK Stock Broker to Buy Centrica Shares
- 2 Step 2: Research Centrica Shares
- 3 Centrica Share Price History
- 4 Centrica Shares Dividend Information
- 5 Should I Buy Centrica Shares?
- 6 Step 3: Open an Account and Deposit Funds
- 7 Step 4: Buy Centrica Shares
- 8 Centrica Shares Buy or Sell?
- 9 The Verdict
- 10 eToro – Buy Centrica Shares With Zero Commission
- 11 FAQs
As noted above, Centrica shares are listed on the London Stock Exchange, so there are lots of UK stock brokers to choose from.
You do, however, need to ensure that your chosen broker is licensed by the FCA, and that it offers low fees and commissions. It’s also worth checking that your preferred payment method is supported – such as a debit/credit card or bank account.
With this in mind, below we discuss the best FCA brokers to buy Centrica shares from in 2020.
1. eToro – Buy Centrica Shares with Zero Commission
eToro is our number one pick for buying Centrica shares in the easiest and most cost-effective way. Crucially, the online broker allows you to buy shares on a commission-free basis. This is the case across all of its 800+ listed stocks. On top of Centrica, you can invest in a full range of FTSE 100 shares. You can also buy shares in international firms.
This is because the platform likes to take a somewhat simple approach to investing. All you are required to do is open an account, deposit some funds, and then choose how many Centrica shares you wish to buy. You can get money into your eToro account instantly with a UK debit/credit card or e-wallet. You can also transfer funds from your UK bank account, although this can take a couple of days to arrive. Minimum deposits start at $200, which is about £160.
However, you can invest from just $50 into Centrica shares, so you can use the balance across other stocks. eToro is also a pioneer of Copy Trading. This allows you to copy an investor that you like the look of. For example, if the trader has 10% of their portfolio in HSBC shares, your portfolio will mirror this. This is great for passive investing. Finally, eToro is licensed by the FCA and it has also partnered with the FSCS. This ensures that you can trade in a safe and secure environment.
- User-friendly online stock broker
- Buy shares without paying any commission or share dealing charges
- 800+ shares listed on UK and international markets
- Buy shares or trade CFDs
- Social and copy trading tools
- Accepts PayPal
- Mobile trading app
- Holds an FCA licence
- Not suitable for advanced traders that like to perform technical analysis
67% of retail investor accounts lose money when trading CFDs with this provider.
2. Capital.com – Trade Centrica CFDs With Tight Spreads
Although eToro is the best UK broker to buy Centrica shares from, Capital.com is worth considering if you are looking to place more sophisticated trades. This is because the platform offers CFDs (contracts-for-differences). Put simply, this means that you will be trading assets without taking direct ownership.
In the case of Centrica shares, you will have the option of going long or short. In other words, not only can you speculate on Centrica shares going up in value, but also down. This ensures that you can profit from the financial markets no matter how the wider economy is performing. On top of Centrica, you can trade over 2,000+ stock CFDs.
This includes both UK and international marketplaces. Outside of its stock department, you can also trade indices, forex, cryptocurrencies, and commodities. Regardless of the asset class, Capital.com allows you to trade on a commission-free basis. As such, it’s only the spread that you need to pay. We should also note that Capital.com allows you to trade Centrica share CFDs with leverage.
If applying the maximum limit of 1:5 – this means that you can trade with five times more than you have in your account. For example, if you have an account balance of £100, you can trade with £500. In terms of getting started, Capital.com allows you to deposit from just £20. You can do this with a debit/credit card or e-wallet. If you want to use your bank account, the minimum is £250. Finally, Capital.com is regulated by the FCA.
- Trade over 2,000+ share CFDs
- Educational app for new traders
- AI assistant identifies your weak points
- Trade ideas generated daily
- Excellent charting and analysis interface
- 100% commission free trading
- Cannot build custom trading strategies
So now that we have covered the best UK brokers to trade or buy Centrica shares from, you now need to perform some research on the stock. Don’t forget, there is never any guarantee that you will make money from an investment, whether you’re investing in Centrica or other companies like BP, Shell or National Grid. This is especially the case during the uncertainties of the coronavirus pandemic.
To help point you in the right direction, below we discuss the Centrica share price history, its current dividend policy, and where the stocks are likely to go in the near future.
Centrica PLC is a UK-based gas and electricity service company. It is the parent group behind a number of well-known suppliers, such as British Gas, Direct Energy, and Spirit Energy. On top of its core UK audience, Centrica also supplies consumers in Ireland and North America. In terms of its share price history, Centrica first went public in the mid-1990s. Back then, you would have paid in the region of 88p per share.
The stocks then went on an excellent run right up until 2007 – where they peaked at just under 390p. In response to the financial crisis of 2008 that was to follow, the shares reversed in direction – hitting lows of 220p. However, Centrica shares quickly recovered, reaching 390p in 2013. Since then, it’s been a woeful time for stockholders. In fact, as of August 2020, the shares are worth just 47p. This means that Centrica now has a valuation that is close to 50% lower than its 1995 price.
In more recent times, Centria shares were showing signs of positivity – going from 65p to 93p between August 2019 and February 2020. This represented growth of 43% in the space of just 6 months. But, as per the market sell-off that was spurned by the pandemic, the shares dropped to all-time lows of 29p in April. This is somewhat concerning, not least because Centrica offers products and services that should always be in demand – no matter how the wider economy is performing.
Although Centrica had a stable dividend policy for a number of years, the firm has since suspended this. The announcement was made in April in response to the wider concerns of the COV-19 pandemic.
Initially, the firm had planned to pay a final dividend of 3.5p per share, with the payment ear-marked for June. Ultimately, there is no knowing when Centrica will resume its dividend policy, so, for the time being, you will need to focus exclusively on capital gains.
Centrica shares have struggled in recent years. In fact, since the shares peaked in 2013 at 390p – Centrica has been on a downward spiral. This doesn’t mean that you shouldn’t invest per-say. On the contrary, there is every chance that at current prices – you can buy the shares at a major discount.
Before taking the plunge, we would suggest reading through the following considerations.
Timing the Market
On the one hand, it is true that Centrica shares have been hit hard by the stock market sell-off as a result of the uncertainties of the pandemic. It is also true that the shares were already on a prolonged downward spiral before the pandemic came to fruition. However, the shares have recovered nicely from their 2020 lows.
For example, had you purchased Centrica shares in April at 29p, you would now be looking at gains of 62%. With that being said, the resurgence might not yet be over. After all, Centrica stocks were priced in and around the 70p to 90p-mark before the 2020 downfall begun. Even at the lower end, this would leave a potential upside of 48% if it is able to return to pre-pandemic levels.
Management at Centrica have announced their plans to cut operating costs by £2 billion. This is a somewhat ambitious target at a time when margins are already wafer-thin.
With that said, Centrica has already got the ball rolling. For example, it announced last month that it plans to cut 5,000 jobs, as well as re-visit its relationship with contractors. Additionally, Centrica has cancelled its dividend policy until further notice.
No Longer a FTSE 100 Share
Fully in-line with the firm’s recent downfall, Centrica has since fallen outside of the FTSE 100 index of companies. This can be highly detrimental, as large ETFs and other financial institutions will often place vast sums of capital into FTSE 100 firms as a way of tracking the primary UK stock index. With Centrica subsequently losing its FTSE status, this means that there will be less interest in the shares.
$3.6 Billion Sale of NRG Energy
Leading on from the above section on Centrica placing much of its focus on cost-cutting, the firm has since announced that it plans to sell its NRG Energy subsidiary. The proposed sale is expected to raise $3.6 billion. This will provide Centrica with some much-needed capital. When the announcement was made back in July, Centrica shares finished the trading day 22% higher.
Centrica’s most recent earnings report did not sit well with stockholders. Its half-year results yielded a 9% drop in revenues, and a 14% decline in operating profits. This resulted in an operating loss of £135 million.
Step 3: Open an Account and Deposit Funds
So now that you have had a chance to perform some crucial research on Centrica, the next stage is to open an account with your chosen share dealing platform. We are going to show you what you need to do with FCA-broker eToro, which offers one of the best share dealing accounts and allows you to buy shares without paying any commission.
To get the ball rolling, head over to the eToro platform and look out for the ‘Create Account’ button. Then, you’ll need to enter some personal information. This includes:
- Full name
- Date of birth
- Home address
- National insurance number
- Contact details
- Username and password
eToro will now ask you to upload some ID. You don’t need to do this straight away if you plan to invest less than £1,800-ish. You will, however, need to upload your documents before making a withdrawal. As such, it’s best to get the ID process out of the way now.
The two required documents are passport or driver’s license and a recent utility bill or bank account statement
When it comes to making a deposit, you can choose from a debit card, credit card, Paypal, Skrill, Neteller, or UK Bank Transfer.
Don’t forget, you will need to meet a minimum deposit of $200. Each of the above payment methods are instantly processed apart from a bank account – which can take several days.
Now that you have funded your account, you can buy Centrica shares. Enter ‘Centrica’ into the search box at the top of the page, and click on the result that loads up.
You will then need to click on the ‘Trade’ button. In doing so, you will be presented with an order box.
All you need to do here is enter the amount that you wish to invest. Although you are buying a UK-listed stock, eToro denominates everything in US dollars. The minimum investment is $50, which is about £40.
Once you have entered your stake, you simply need to click on the ‘Open Trade’ button.
If you’ve read our guide up to this point, then you will know that Centrica shares are currently experiencing tough times on the London Stock Exchange. In fact, not only have the shares been on a downward spiral for near-on 7 years, but the stocks have since lost their place as a constituent of the FTSE 100.
However, not everyone is feeling bearish on Centrica – which is evident when looking at market sentiment at leading UK brokers Plus500 and IG. For example, while the former is seeing 99% of traders long on the stock, IG is at 97%. This could illustrate that at current market prices, investors believe that Centrica is undervalued.
Make no mistake about it – if you were in possession of Centrica shares in and around 2013 and you failed to offload them, you would now be looking at substantial losses. With that said, timing the market is everything when trading stocks, so you now stand the chance of making an investment at a huge discount.
If this is a sentiment you possess, you can easily buy Centrica shares at eToro. Not only does the end-to-end investment process take minutes to complete, but you won’t pay a single penny in commission.
Simply click the link below to get started!
67% of retail investor accounts lose money when trading CFDs with this provider.
How much were Centrica shares when the firm first went public?
Centrica shares hit the London Stock Exchange in the mid-1990s. Back then, you would have paid around 88p per share.
Is Centrica on the FTSE 100?
Until recently, Centrica was a long-standing constituent of the FTSE 100 index. However, due to the firm's market downfall, it has since been removed.
Does Centrica pay dividends?
Centrica announced in April that it would be suspending its dividend policy until further notice. It has planned to distribute a dividend in June, albeit, this will no longer be the case. There i no knowing when Centrica will resume its dividend policy.
Does Centrica own British Gas?
Yes, alongside a number of other gas and electricity subsidiaries, Centrica owns British Gas.
Where can I buy Centrica shares?
As Centrica is listed on the London Stock Exchange, you can buy its shares from any online broker that gives you access to UK stocks. eToro is well considering in this respect, as the platform allows you to buy shares on a commission-free basis.