Forget about the Covid-19 crisis for a second. Bin any Brexit concerns you may have and cast off your worries about fresh trade wars in 2021. There’s never been a better time to go shopping for UK shares. Well, not since since the 2007-2008 financial crisis at least.
There are stacks upon stacks of top stocks trading much too cheaply right now. The 2020 stock market crash meant that scores of five-star UK shares unjustifiably fell through the floor. And the disappointing performance of broader UK share markets in that time means a great many have failed to snap back.
Buying after the stock market crash
This gives eagle-eyed investors a chance to nip in and grab bargains galore. It gives them a chance to supercharge the returns they can expect to make over the next decade too. Don’t forget that it took the FTSE 250 less than a decade to treble in value from the lows struck in 2009. I’m backing UK share prices to rebound strongly again like they did after the banking crisis.
I haven’t been discouraged from investing by the uncertain economic outlook. Many top UK shares out there will still generate brilliant shareholder returns in 2021 whatever happens to the global economy.
2 UK shares on my ISA radar
Here are two cheap, quality stocks I’m thinking of buying for my Stocks and Shares ISA. I think they’ll deliver mighty returns all the way through to the end of the decade:
#1: There’s a lot to like about Smurfit Kappa Group going into 2021. The FTSE 100 firm’s most recent financials in November showed it trading above expectations. And the drivers that helped it beat forecasts, like roaring e-commerce growth and soaring demand for sustainable packaging, are factors that’ll likely underpin robust profits growth all through this new decade.
Meanwhile, Smurfit Kappa’s huge exposure to the defensive fast-moving consumer goods (FMCG) segment should assuage the fears of any investors worried about a fresh slowdown in the global economy. This UK share trades on a forward price-to-earnings (P/E) ratio of 17 times, making it the cheapest of all of London’s listed paper and packaging plays.
#2: Housebuilder MJ Gleeson is another top stock on course for a strong 2021. And, on paper at least, it offers even better value than Smurfit Kappa. It trades on a forward price-to-earnings growth (PEG) readout of 0.1. Things don’t get better than that.
This share continues to enjoy “strong demand for our low-cost homes,” it announced this week. MJ Gleeson can expect its new builds to keep selling like hotcakes too, as low interest rates and government support for first-time buyers continues. Even if property price growth in the UK cools, this small-cap and its peers can still look forward to excellent profits growth now and in future years.