I've got my eye on Wesfarmers Ltd (ASX: WES) shares right now. The Wesfarmers share price is up 17.6% this year but I think it could climb further.
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Why I like the Wesfarmers share price right now
One big reason I like Wesfarmers is its large-cap status. The Wesfarmers market capitalisation is $55.3 billion which makes it a heavy hitter within the S&P/ASX 200 Index (ASX: XJO).
Given the uncertainty we're seeing right now, I like the safety of large companies like Wesfarmers.
It's not just the sheer size of the company but also its earnings diversification. Wesfarmers reported solid earnings contributions from across its Bunnings, Kmart, Officeworks and Catch business units.
The Wesfarmers share price edged lower on Thursday after the full-year earnings result which showed strong earnings but a cautious FY21 outlook.
I think there was a lot to like about the result including a robust balance sheet with deep cash reserves. That was evidenced in the conglomerate's 18 cents per share special dividend following its sale of another stake in Coles Group Ltd (ASX: COL).
That cash position is another reason why I like the Wesfarmers share price right now. Under normal circumstances, I would be worried about cash being a drag on performance.
However, the coronavirus pandemic has thrown a spanner in the works. I think holding cash could be a good idea right now, especially with inflation looking unlikely to head higher.
It leaves Wesfarmers well-placed to make some acquisitions when things settle down. Given the economic conditions are likely to worsen in the medium term, that could also present some undervalued buying opportunities.
When those opportunities present themselves, Wesfarmers will be waiting with a fistful of cash to snap up a bargain. That could be good news for the Wesfarmers share price and the company's investors.
Foolish takeaway
The Wesfarmers share price has outperformed in 2020 but I think it has further to run.
Strong earnings, a healthy cash position and tactical buying opportunities on the horizon bode well for future growth.
