I’m looking for some top UK shares for my investment portfolio. Here are what I think could be two of the best cheap stocks to buy right now.
One of the best healthcare stocks to buy?
Demand for private healthcare in the UK is soaring. The Covid-19 crisis has put the NHS under unprecedented strain and patients are having to wait for treatment like never before.
The government has suggested that the problem will get worse before it gets better too. This week, health secretary Sajid Javid warned that hospital waiting lists — which currently sit at record peaks of 6m — will continue to grow until March 2024, at least.
All this is playing into the hands of private healthcare providers like Spire Healthcare Group (LSE: SPI). Indeed, the company’s September financial update showed revenues grew by robust double-digit percentages in the six months to June. Sales were up 38.9% and 13.5% versus the same 2020 and 2019 periods respectively.
I’m expecting Spire’s full-year update on 3 March to show that trading has remained robust since then. The healthcare provider has risen an impressive 53% in value over the past year. And I think that upcoming update could drive the share price even higher.
Spire’s ultra-cheap share price certainly leaves plenty of scope for fresh gains. Today, the business trades on a tiny forward price-to-earnings growth (PEG) ratio of 0.1. I’d buy the business despite the threat posed by larger market operators such as BMI-owner Circle Health Group.
A dirt-cheap penny stock I’d buy
I also believe TheWorks.co.uk (LSE: WRKS) could be too cheap for me to miss today. It currently trades on a forward price-to-earnings (P/E) ratio of just 7.7 times. It’s a rating I don’t believe reflects this value retailer’s strong trading outlook.
Britons are finding it increasingly hard to make ends meet as inflation rockets. The Bank of England expects consumer price inflation to exceed 7% in April too. National Insurance tax hikes in the spring threaten to crush shopper spending power even more.
Consumers will have to shop increasingly cleverly to maintain their present lifestyles. And this is where I think The Works comes in.
Through its 500-plus stores and its website the business sells games, books, craft products and other goods at lower prices than much of the high street. I expect the number of people passing through its doors to grow as people shop around.
I don’t just think The Works is a great buy for the near-term though. And this isn’t just because the value retail boom was expected to continue regardless of this recent inflationary surge.
The retailer’s product categories are ones that are tipped to grow strongly in the years ahead. Take board games for instance. Researcher Technavio thinks this market will grow at a rate of 7.1% between 2021 and 2025.
Profits at The Works could suffer if the cost of stocking its stores also continues to rise. But, all things considered, I think things are looking extremely good for this UK stock and its investors.