In the short run it is hard to predict what would be the Best stocks to invest in 2021 Uk, but in the long-term I expect stocks with a dividend yield of more than 2.5% will do well. In this article I will discuss my favourite stocks with a good dividend yield and good growth prospects over the next 5 years.
Stocks are the very best approach to drop some weight. There are drawbacks alongside one of the most obvious benefits of buying stocks. Bottom line, it’s crucial to have knowledge that’s available before you even stay with investing in stocks. This is perfect for both experienced stock brokers and beginners.
Lloyds (LON: LLOY)
Consensus ratings from research teams were largely bullish on Lloyds, with 16 ‘buy’, eight ‘hold’, and two ‘sell’ recommendations.
Their average target price for LLOY shares stood at 53.62 pence, Bloomberg data showed as of 05 October.
JPMorgan rated LLOY ‘overweight’ with a 60p price target, saying the stock may offer the highest upside among UK banks on its forecasts.
Despite a weakening mortgage market, the British financial institution’s top-line recovery remains on track, in JPMorgan’s view, driven by the yield curve and consumer recovery.
One of the strategic challenges facing the lender and incumbents is the growth of new digital banks in the country with technology that also leverages open banking. ‘However, Lloyds retains a unique scale advantage over most other UK retail banks due to its leading market share,’ JPMorgan analysts said.
They continued to see value in Lloyds’ branch network ‘as long as it is used effectively to service complex needs and offer advice, driving growth in fees and increased share in wealth and pensions’.
Meanwhile, Bloomberg Intelligence (BI) wrote that the contribution of UK retail and corporate net-interest income ‘has been a source of pain for many years’ for Lloyds and its peers. This was exacerbated by the 2020 rate cuts.
However, the ‘plunging credit-card balances, a spike in savings, and a net interest margin (NIM) slide look set to stabilise from 3Q’, BI said.
The BI analysts added that the NIM decline may bottom out in late 2021 as Lloyds’ ‘improved guidance is now reflected in consensus, which has improved 4 to 5 basis points since July’.
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easyJet (LON: EZJ)
The low-cost carrier’s share price shot up as much as 25% in the last three weeks.
The rally came after easyJet went ex-rights on 13 September 2021 following a £1.2 billion rights issue, and after the US announced it would relax travel restrictions on the UK and EU countries.
As at the end of September, 14 analysts recommended ‘buy’ on EZJ’s stock, eight suggested ‘hold’, while one gave a ‘sell’ call. Their average target price was 765.52p per share, Bloomberg data showed.
Regarding easyJet’s rights issue, Deutsche Bank analysts wrote that ‘the timing and amount of the equity raise make sense’. They reiterated a ‘buy’ rating while eyeing a 750p target on EZJ shares.
The company is expected to receive the net proceeds on 01 October 2021.
‘With easyJet’s balance sheet set to be in a much better place as it emerges from the Covid-19 crisis thanks to the proceeds from the rights issue, and with management focusing on cost to the potential benefit of profits per passenger, we see the group as heading in the right direction,’ Deutsche Bank said.
Meanwhile, JPMorgan was ‘neutral’ on the EZJ stock, and reduced its target to 595p partly given the significant dilution to earnings per share from the rights issue.
However, the rights issue ‘meaningfully improves EZJ’s gearing’ and also allows the company to invest in new airport slots and potentially in new, more fuel-efficient aircraft, the research team noted.
‘Assuming EZJ does not receive another takeover bid, we consider the shares fairly valued,’ JPMorgan said.
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Boohoo (LON: BOO)
The online fashion retailer’s share price has plunged nearly 18% since it reported first half results for 2022 on 30 September.
Although Boohoo’s sales increased 20% in 1H 2022 against the corresponding period in 1H 2021, ‘performance in the second quarter was impacted’ by UK returns rates returning to pre-pandemic levels, physical stores reopening and consumer uncertainty in markets where it operates.
This resulted in the loss of key events and holidays, as well as continued COVID-19 related disruption across the group’s key international markets, which has impacted international delivery timeframes.
Adjusted EBITDA at £85 million was a 5% year-on-year decline from the £89.8 million achieved in the first half of 2021.
The e-commerce group also warned of ongoing short-term cost headwinds experienced in the first half, which are expected to continue in H2 alongside ‘recent freight inflation in our supply chain and wage inflation within our distribution centres’.
Consequently, adjusted EBITDA margins are now expected to be 9% to 9.5%, compared to 9.5% to 10% as previously guided. Capex, meanwhile, is now expected to be around £275million for the year, slightly above the top end of previous guidance of approximately £250 million.
Following the guidance, Barclays analysts lowered their Boohoo stock price target to 415p from 530p. They continue to eye an ‘overweight’ rating on the shares as of 04 October.
Aviva plc (LSE:AV.L)
P/E Ratio: 9.09
Aviva plc (LSE:AV.L) ranks tenth on our list of the best undervalued UK stocks to buy now. This September, Barclays lifted its price target on Aviva plc (LSE:AV.L) to GBX 505, while keeping an ‘Overweight’ rating on the shares. The firm’s analyst noted the company’s growth potential and believes that it is well-positioned to benefit from the growing insurance industry in the UK.
Aviva plc (LSE:AV.L) is a British multinational insurance company that provides services in savings, retirement, and insurance. In 2020, Aviva plc (LSE:AV.L) shares slumped, reaching their all-time low at GBX 231, due to the global market clampdown. Due to this, the company also had to cut its dividend payment. However, it bounced back in 2021. Currently, Aviva plc (LSE:AV.L) pays an annual dividend of GBX 21 per share, yielding 5.20%.
Aviva plc (LSE:AV.L) is currently traded at a trailing twelve months P/E ratio of 9.09. Since the beginning of the year, the stock delivered a 22.55% return to shareholders, while it gained 39.4% in the past year.
Aviva plc (LSE:AV.L) is one of the notable stocks in 2021 like Bank of America Corporation (NYSE:BAC), The Kraft Heinz Company (NASDAQ:KHC), DaVita Inc. (NYSE:DVA), Berkshire Hathaway Inc. (NYSE:BRK-B), and Amazon.com, Inc. (NASDAQ:AMZN).
Redrow plc (LSE:RDW.L)
Number of Hedge Fund Holders: N/A
P/E Ratio: 9.11
Redrow plc (LSE:RDW.L) is currently traded at GBX 668.80, after hitting a low of GBX 313.2 due to the pandemic-related global market crash in March 2020. The stock gained 45.3% in the past year, while its year-to-date returns stood at 21.7%. The company stands eighth on our list of the best undervalued UK stocks to buy now.
Redrow plc (LSE:RDW.L), one of the greatest homebuilders in the UK, pays an annual dividend of GBX 0.06 per share, yielding 0.01%. This August, Berenberg lifted its price target on Redrow plc (LSE:RDW.L) to GBX 820, with a Buy rating on the shares, highlighting the UK’s government announcement for supporting the housing market.
Redrow plc (LSE:RDW.L) has a trailing-twelve-month P/E ratio of 9.11.
Tesla (TSLA) – Overall Best Share to Buy Right Now (BUY)
- Industry: Automotive
- Current price: $909.68
- Market value: $900.60 billion
- Dividend yield: N/A
- YTD return: +24.65%
October 25 to October 29: Our top pick in the stock market right now is Tesla. Many people buy Tesla stock due to Elon Musk’s popularity, but aside from this factor, Tesla is an exceptionally innovative and exciting company. Although there have been some bumps in the road this year, Tesla look set to finish 2021 strongly.
Recent Q2 results noted that Tesla sold a remarkable 201,250 vehicles, which is 120% more than Q2 2020. Furthermore, some exciting changes will be happening for Tesla soon, with the mega-popular Cybertruck coming out next year. In addition to this, Tesla is also building a big-rig truck that will appeal to freighting companies worldwide.
Finally, Tesla is upping their manufacturing capabilities and expanding its cars’ self-driving abilities. These factors combine to make Tesla ready to increase over the coming year. With the stock price down around 16% from January’s highs, now might be a great time to add Tesla to your portfolio.
Alphabet (GOOGL) – Best Tech Stock to Buy Right Now (BUY)
- Industry: Conglomerate
- Current price: $2,751.33
- Market value: $1.84 trillion
- Dividend yield: N/A
- YTD return: +59.39%
October 25 to October 29: Alphabet, the parent company of Google, is one of the world’s largest companies, mainly thanks to Google’s incredible rise over the past two decades. Many people invest in Alphabet stock due to the company’s ability to innovate and remain at the top of the pile, which is no easy feat in the technology sector. We like the look of Alphabet’s stock right now, as the company has recently pulled back from its all-time high, offering an excellent place to invest at.
Google has a market share of 92.47% of the world’s web searches, according to Statista, highlighting just how pervasive the company is. Through this market share, Google can generate incredible amounts of ad revenue whilst gleaning lots of user data to improve their services. This process shows no signs of stopping, which is why Google (and therefore Alphabet) will continue to grow.
Finally, Alphabet is still innovating in areas such as cloud computing and self-driving cars. These areas are poised to reshape how we live in the years to come, so the fact that Alphabet is thinking ahead puts the stock in a good position. With net income still increasing year on year, we’d recommend adding Alphabet to your portfolio if you’re looking for some exposure to the tech sector.
Conclusion
Even in this time, people are making huge amount of money through stock investing. They are the smart investors, yes? Well, it’s not that much easy to invest in stocks. You need to have enough patience and you must be able to predict the movement of the market. For this, you need to be alert always.