888 Holdings (LSE:888) and Just Eat Takeaway (LSE:JET) test body copy

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Sam Robson has no position in any of the shares mentioned. The Motley Fool UK has recommended Just Eat Takeaway.com. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Now may look like a bad time to buy FTSE 100 shares, but I beg to differ. Today’s turmoil offers a brilliant buying opportunity, but with three provisos.

At The Motley Fool, we never like to waste a stock market crash. Or even a dip, like the one the FTSE 100 is suffering at the moment. 

The index of top UK shares has been relatively resilient in 2022. It is down 8.09% year-to-date while the US S&P 500 has crashed 23.49%. Yet the FTSE 100’s relatively smaller drop is still throwing up lots of share buying opportunities for me.

FTSE 100 offers me great value

When an individual stock falls sharply in value, I tread carefully. Usually that’s due to a bad piece of company news, such as a profit warning, reduced dividend, or some other nasty that weighs on its prospects.

When the whole FTSE 100 falls, it’s a different matter, as good companies are sold off with the bad. Investors are fleeing risk right now, as today’s problems aren’t going away soon. Post-Covid supply shortages, war in Ukraine, and (crucially) rising interest rates are combining to destroy investor sentiment.

These problems will hit some sectors harder than others. Housebuilders such as Barratt Developments will suffer as rising mortgage rates hit demand. So will asset managers such as Schroders, as markets go haywire. Supermarkets like Sainsbury’s are also suffering, as customers buy less or trade down.

By contrast, luxury goods maker Burberry Group is on safer ground as the wealthy are less affected by the cost-of-living crisis. So is spirits maker Diageo, as its customers need a stiff drink right now.

I’m focusing my attention on companies that have been hit hardest, as their share prices have fallen most. They offer a tempting combo of dirt-cheap valuations and astonishing yields. I’ve just taken a punt on housebuilder Persimmon. I’m worried I may regret this, but found its 19.49% yield and valuation of just 4.81 times earnings too ridiculous to resist.

I’m now caught between buying Tesco for long-term income and growth, or investing in Rolls-Royce shares in the hope they will lead the charge when markets recover.

Three ways I reduce risk

The big risk is that markets could fall further from here, but I’m happy to take that chance for three reasons. First, it’s impossible to buy right at the bottom of the market. Today’s lower prices are good enough for me.

Second, I’m building a balanced portfolio of FTSE 100 stocks on top of that, to turbo-charge my growth. I aim to hold at least a dozen, so if one or two fail to deliver, hopefully the others should more than compensate.

Finally, and most important, I’m only buying shares that I plan to hold for the long term. That means at least 20 years, which should give plenty of time for the FTSE 100 to rebound from its current troubles.

Sometimes I have to steel myself to click the ‘buy’ button but if I wait until after the FTSE 100 has recovered, then the same stocks should cost a lot more than they do today.

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Harvey Jones doesn’t hold any of the shares mentioned in this article. The Motley Fool UK has recommended Burberry, Diageo, Schroders (Non-Voting) and Tesco. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Rolls-Royce (LSE: RR) shares just go from bad to worse. Yet this remains one of the UK’s most traded stocks as investors still believe there is a great opportunity here. So far, it’s been a losing bet, with the stock sliding 80% over the last five years.

Bargain hunters who bought 12 months ago have lost 53.97% of their money. Anyone who bought a month ago is down 17.89%.

The civil aerospace, power systems and defence engineer may have a Roll-Royce name, but the underlying business is anything but smooth. The pandemic was tough on its aerospace business, which generates most of its revenues from maintenance contracts attached to its engine sales. These are based on miles flown, a disaster as Covid grounded fleets.

The shares have been a losing bet

A company that posted almost £4bn of pre-tax profits in 2017 suffered a £294 million loss last year. This year, it anticipates low-to-mid-single digit underlying revenue growth, but I suppose that’s better than nothing. Last year’s underlying operating profit margin of 3.8% will be repeated this year, which suggests the turnaround will take time.

Departing chief executive Warren East was admired for his valiant but doomed battle to turn this crate around. New CEO Tufan Erginbilgic is picking up the mantle at a pivotal time for the £5.54bn FTSE 100 business.

Rolls-Royce recently reported a drop in first-half underlying operating profit from £307m to £125m. While dispiriting, this also reflected £371m in research and development costs designed to grow the business.

Its Power Systems division reported record order intake, while Civil Aerospace engine flying hours continue to recover and its Defence arm boasts a strong order book. So all is not lost.

Yet we live in a world of worry, as supply chain problems persist, energy prices soar and inflation rockets, pushing up the costs of key raw materials like titanium. This will all weigh on any Rolls-Royce recovery.

The FTSE 100 is packed with stocks trading at price/earnings ratios of less than 10 while offering dividend yields of 5% and, in some cases, a lot more. Rolls-Royce trades at a whopping 185.5 times forecast earnings and doesn’t pay any dividends. It may restore shareholder payouts next year, with free cash flow now “modestly” positive, but I’m not holding my breath.

I’m taking a small punt on this stock

It still has debt of more than £5bn, although it also has access to £7.1bn of liquidity, including £2.6bn in cash holdings.

Rolls-Royce does have an exciting opportunity in building small modular nuclear reactors that can power a million homes for around £2bn a pop. However, this is a 25-year programme that demands upfront capital investment, so the payback time will be slow.

The same could be said of Rolls-Royce shares. I think they have an opportunity to snap back when sentiment improves. Since that is impossible to time, I’m going to take a small position in the next few days. I just hope I don’t end up joining a long line of unlucky gamblers.

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Harvey Jones doesn’t hold any of the shares mentioned in this article. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

If I had as much as £10,000 to pump into a Stocks and Shares ISA right now I’d be looking to load up on top FTSE 100 dividend shares.

After years of trailing major indices such as the S&P 500, London’s blue-chip index is showing it’s made for tough times. US tech stocks may have cashed in on the cheap money era, but FTSE 100 shares now offer bruised investors a welcome safety net.

Investing goes in cycles and the tech splurge lasted beyond its natural term. That came as central bankers piled on the stimulus during the Covid crisis. Now investors are prioritising ‘value’ stocks, dividend-paying companies trading at low valuations. 

My ISA line-up

The FTSE 100 is full of them and I’d start by exploring these 10 companies. All have risks, but offer big opportunities too.

Insurer Aviva has delivered little share price growth in recent years. But it’s a dividend aristocrat paying income of 9.95%. Trading at a dirt-cheap 6.8 times earnings, it’s hard to resist.

Barclays is even cheaper at just 3.7 times earnings, while yielding 4.28%. Sticking with financials, I also like Lloyds Banking Group, cheap at 5.5 times earnings with a 4.82% yield (and future dividend growth).

The financials sector is being shaken by the gilt crisis, while rising interest rates could squeeze both small business and retail customers. But I reckon those risks are reflected in their rock-bottom valuations.

I’d also include transmissions giant National Grid. Frankly, this is a stock I’d buy at any time, as a core portfolio holding. Today it yields 5.77% and looks fair value at 14.4 times earnings. It’s a solid long-term buy and hold for my ISA.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Higher yields

With that as security, I’d take a bigger punt and buy a housebuilder such as Persimmon that yields a ridiculous 19.37%. Although I expect the dividend to be cut sooner rather than later, that won’t be a disaster given today’s starting point. House price crash fears are priced in at a valuation of 4.9 times earnings. At least, I hope they are.

Mining giant Rio Tinto is the second highest yielder on the FTSE 100 offering 14.21% and trading at 4.2 times earnings. Chinese demand for commodities is slowing and the dividend may be reduced at some point. Now still looks like a great entry point for contrarians like me. I’d also consider gold miner Fresnillo. It may benefit when inflation easies, the US dollar softens and the gold price recovers.

Clothing retailer Next will obviously suffer as discretionary consumer spending falls. But it looks better placed than most, and I’d consider it for my ISA too. Then I’d buy Unilever, because I’ve never seen it this cheap at 17.2 times earnings (it’s usually around 24 times) while yielding 4.42%.

Finally, I’d include spirits giant Diageo in my top 10. Yes, it looks expensive trading at 24.1 times earnings while the yield is just 2.08%.But it’s a solid, recession-proof business and they come at a premium in these troubled times.

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Harvey Jones doesn’t hold any of the shares mentioned in this article. The Motley Fool UK has recommended Barclays, Diageo, Lloyds Banking Group and Unilever. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

The UK is in a pickle but that isn’t going to stop me from buying cheap shares. In fact, I see it as a good time to do so.

The FTSE 100 has dropped below 7,000, after the Bank of England’s battles to prevent a pension fund meltdown and another sterling collapse. It trades at 6,913 as I write this, a drop of 7.89% year-to-date.

It has fared better than the US S&P 500, which is down a brutal 24.49% this year. The FTSE 100 is full of solid, undervalued dividend stocks in sectors like banking, utilities, mining, consumer staples and energy. By contrast, the S&P 500 is packed with overvalued growth stocks that are struggling as sentiment plummets.

I’m looking for cheap shares now

Yet the FTSE 100 has dropped far enough to offer me real value. Some of my favourite shares are available at astonishingly low valuations, as measured by the price/earnings ratio.

Anglo American is trading at 4.2 times earnings and yields a staggering 9.54%. That offsets most of this year’s inflation surge. Like any stock, it is not without its risks. The slowing Chinese economy is hitting demand for raw materials. Given today’s dirt-cheap valuation, that is a risk I’m happy to take.

I’m also tempted by housebuilder Barratt Developments, which is valued at a meagre 4.1 times earnings and yields an amazing 10.8%. Again, there’s a reason why this share is cheap.

UK interest rates look set to rise sharply and this will drive up mortgage costs, forcing some owners to sell as they can’t manage repayments. House prices are likely to fall to match the new reality of higher borrowing costs. 

Pharmaceutical giant GSK, formerly GlaxoSmithKline, looks tempting too. Currently, it’s valued at just 11.99 times earnings while its yield has rocketed to 7.12%.

GSK even enjoyed a share price boost this week after its whooping cough vaccine was approved for use in pregnant women in the US. Yet it also faces a specific risk, with a potential $5bn litigation cost for stomach acid treatment Zantac, which may elevate cancer risk. This may not be resolved for several years, weighing on the share price.

FTSE 100 shares at tempting prices

These are big businesses with solid core operations that are astonishingly cheap. That makes me tempted to buy them (although I’ll need to explore GSK’s Zantac issue further).

2022 has been a tough year for markets and the UK now looks set to fall into recession, which could last for all of 2023. Despite all the problems, that won’t stop me from buying shares today for two reasons.

First, wider stock market movements are impossible to predict, so I don’t even try. Second, because I’m investing for a minimum of 15 to 20 years. Over such a lengthy period, any shares I buy today have plenty of time to recover.

The sooner I buy cheap shares like these, the sooner I can start reinvesting their dividends to purchase more stock. By the time the recovery comes, my holdings will be bigger, and with luck I will reap the rewards.

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Harvey Jones doesn’t hold any of the shares mentioned in this article. The Motley Fool UK has recommended GSK plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Tesco (LSE: TSCO) shares have had a bumpy 2022 but now they look like a tempting buy to me. The figure that really jumps out at me is the dividend yield, which is currently 5.4%.

Last time I looked, Tesco was yielding closer to 4%. The most obvious reason for the increase is that its share price has fallen (as have so many other FTSE 100 stocks in these troubled times).

Tesco shares are down 26% over the last six months, although over five years they trade 7.56% higher. As the yield is calculated by dividing the dividend by the share price, that has inevitably pushed it higher. Yet the dividend looks solid, as it is covered exactly twice by earnings.

Tesco shares are at a discount

This year has been tough on the grocery sector. Sainsbury’s has fared even worse. Its share price is down 31% in 12 months, and 30% measured over five years. That makes Tesco look relatively good, and of course it is.

Tesco is still the UK’s biggest grocer, with a market share of 26.9%, according to Kantar. That easily beats second-placed Sainsbury’s at 14.6% and Asda at 14.1%. The cost-of-living crisis has been tough on the big guns, while discounters Aldi and Lidl have continued their inexorable climb.

Earlier this month, Credit Suisse warned there was “no relief in sight” for grocers. They have little scope to pass on inflationary costs to customers, as those on low incomes either trade down or load up in Aldi.

Tesco is better placed than Sainsbury’s, but Credit Suisse still trimmed its target price from 292p to 238p. Today it trades at 173p. So why would I buy it today?

I’m not particularly optimistic about the UK economy. It’s going to be a tough winter. Chancellor Kwasi Kwarteng’s mini-Budget U-turn may have only given us temporary respite. Shoppers don’t have money to throw around.

Tesco’s management has indicated that its earnings may have further to fall, but I think much of the bad news is reflected in today’s valuation. The share price drop has also made Tesco cheaper to pop into my portfolio. It currently trades at just 9.2 times earnings, compared to roughly 14 times across the FTSE 100 as a whole.

I’d invest those dividends for growth

Tesco shares could get even cheaper if I waited, but that’s far from guaranteed. All I know is that they look good value right here, right now.

Also, Tesco gives me a high level of income. I couldn’t beat that 5.4% yield by putting the same money into a savings account at the moment. The sooner I buy the stock, the sooner those dividends start rolling into my portfolio. I would then reinvest them to buy more Tesco shares, taking advantage of today’s low valuation.

Tesco’s sheer size makes it look like a solid bet for long-term income and growth. I’d aim to hold it for 10 or 20 years. At some point, I hope its share price will rebound, and take my stock and reinvested dividends with it. This week, I’m fulfilling a promise I made at the end of last month to buy shares in Persimmon. When I have the cash, I’ll then look to buy Tesco.

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Harvey Jones doesn’t hold any of the shares mentioned in this article. The Motley Fool UK has recommended Sainsbury (J) and Tesco. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Spirits maker Diageo (LSE: DGE) has been one of my favourite FTSE 100 stocks for the last decade or so. I held it for several years in that time, and sold at a 70% profit. I wish I hadn’t, frankly.

At that point, I hadn’t grasped the point of long-term investing. Today, I buy FTSE 100 stocks with the aim of holding them to retirement and beyond. I reinvest my dividends to pick up more stock today, to generate even more passive income when I retire.

I’ll soon be buying Diageo

Next time I buy Diageo – and there will be a next time, soon – it will be with that goal in sight. This is a stock for all seasons, and recent performance has underlined that.

Over the last 12 volatile months, Diageo shares have climbed by 8.45% while the FTSE 100 as a whole fell 3.93%. Measured over five years, Diageo is up 56.65%. The FTSE 100 is down 6.70% over the same period.

Diageo has thrashed the index over both time scales. It has a habit of doing that. Many see this as a defensive stock, because alcohol sales tend to hold up in a recession as people drown their sorrows. It does just as well in the good times, when drinkers have something to celebrate. Few FTSE 100 stocks can boast such an impressive double selling point.

In July, Diageo posted a 21.4% jump in full-year sales to £15.5bn, with double-digit growth across all regions. That’s incredible, given that it operates in almost every country in the world. Demand was “resilient”. Better still, its premium brands have pricing power, allowing Diageo to pass on extra costs to consumers.

Those figures were enhanced by a post Covid bounce, as lockdowns eased and drinkers could get out of the house. Then again, people carried on drinking scotch, tequila, and beer at home during lockdown. What did I say about the other being a stock for all seasons?

Let’s not get carried away, because Diageo faces headwinds, too. CEO Ivan Menezes recently warned of “significant cost inflation, a potential weakening of consumer spending power and global geopolitical and macroeconomic uncertainty”. 

Here’s what’s holding me back

A big downside for an income investor like me is that its dividend yield is well below the current FTSE 100. Today, the average stock on the index yields 4.15%. Diageo would give me just half that at 2.02%. The FTSE 100 trades at around 14 times earnings, but Diageo is valued at a thumping 25.17 times.

I have followed Diageo long enough to know this is par for the course. It always has a relatively low yield and high valuation. That’s the price of popularity, and the reason I wouldn’t buy it today.

I don’t think it’s overpriced, given its quality. My issue is that right now, a host of other FTSE 100 stocks are trading at dirt-cheap valuations, while also offering mind-boggling yields. It’s an amazing opportunity and I’ll start by purchasing them first.

I’d do anything to hold Diageo in my portfolio, but I wouldn’t turn my nose up at today’s amazing FTSE 100 bargains.

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Harvey Jones doesn’t hold any of the shares mentioned in this article. The Motley Fool UK has recommended Diageo. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Global stock markets are in turmoil and Lloyds (LSE: LLOY) shares are feeling the heat, like many others. I reckon this makes now a great time for me to buy them.

My favourite time to buy top FTSE 100 stocks is when they have fallen in value through no fault of their own. That allows me to buy a good company at an unfairly low price, rather than a bad company at a deservedly low price.

I’d buy Lloyds shares in today’s turmoil

I don’t like buying stocks after profit warnings. That suggests the underlying business is in a poor state and the recovery process could be lengthy. I don’t like buying them in the middle of takeover speculation, either. All too often that proves to be hot air, inflating a bubble that deflates just as quickly.

Lloyds shares have fallen 11.65% in the past week, in a period when the company has not delivered any significant news. In fact, its last meaningful announcement was two months ago on 27 July, when the bank published its half-year results.

They showed a healthy 65% increase in net income to £7.2bn. Pre-tax profits fell 6% to £3.6bn, but that was because the previous year’s earnings were boosted by the release of cash set aside to cover bad Covid debts that never materialised.

The outlook was promising for Lloyds Banking Group, and the company can hardly be blamed for the current sell-off. That is down to last week’s controversial mini-budget by Chancellor Kwasi Kwarteng. 

It sparked a meltdown in the pound and global investor confidence in the UK. The FTSE 100 has fallen by 3.82% in the last five days, while financial services sector rival Barclays is down 8.82%.

I have been looking for a good time to buy Lloyds shares and now I think I’ve found it. They look cheap, trading at 5.77 times earnings. The price-to-book value is just 0.6, where a figure of 1 is considered fair value. 

Lloyds stocks offers an attractive passive income stream, too. The current yield is 4.6%. It is forecast to rise to 5.3%, as management continues to restore dividends. That payout is expected to be covered three times by earnings, and looks solid.

It’s another FTSE 100 bargain

Of course, there are huge dangers. The UK is plagued by what the Bank of England calls “dysfunctional markets”. Interest rates could fly as high as 6% in the spring, leading to a sharp rise in mortgage arrears and bad debts. House prices could fall, triggering a vicious circle.

Lloyds is fully exposed to the UK’s ailing economy, because it is now a purely domestic bank, focusing on consumers and small businesses. Yet rising interest rates could partly work in its favour. They will allow Lloyds to increase net interest margins, the difference between what it pays savers and charges borrowers.

I plan to buy Lloyds shares over the next few days despite the risk that they may have further to fall. The next few months will be bumpy, but I’m not investing for months. I aim to hold this stock for years, or ideally, decades. Lloyds looks like a solid company going cheap. I’ve waited enough. This is my moment to buy it.

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At The Motley Fool, we like to ‘buy the dip’ whenever we can. That means picking up shares after the stock market has fallen, to gain exposure at a lower valuation than just a few days earlier.

We see it as the same principle as going shopping in the sales for, say, clothes or tech, or whatever. Who doesn’t like bagging a bargain? Yet many newbie investors looking to buy shares don’t view it like that. Some get nervous when the stock market dips, in case it heralds further trouble ahead.

I’d buy the dip after last week’s setback

Sometimes they will be right. The stock market may dip, then dip again. Nobody knows for sure what it will do next. However, I have learned that if I keep hanging on and on for the next dip, I never buy shares.

At some point, I have to take the plunge. Timing the stock market is impossible. But when I buy the dip, I am taking advantage of a move that has already happened, rather than second guessing where it goes next.

Stock markets suffered a minor setback last week. The US S&P 500 ended the week 5.15% lower. The FTSE 100 closed just 1.56% down on the week, with the FTSE 250 slipping 2.05%. That’s not a crash, just a little dip. Yet it has thrown up opportunities.

Some individual stocks have fallen by larger amounts. For example, InterContinental Hotels Group and Dechra Pharmaceuticals fell by 4.67% and 4.47% respectively on Friday. Neither are high on my shopping list, though. I’ll pass on these but others may be tempted.

I also like to take advantage of extended share price dips. For example, BT Group is down 11.49% over the last month. Fund manager Schroders has fallen 10.41%. In both cases, this is just the latest stage in a long-term share price decline. 

The two stocks look cheap, trading at P/Es of 6.95 and 10.56 times earnings, respectively. I am sorely tempted by BT, but would need to take a closer look at Schroders. I would never buy a stock solely because it is cheaper.

Two falling stocks I would happily buy

Insurer Aviva has experienced a much smaller drop of 4.02% over the last month. I would consider that dip worth buying because the FTSE 100 insurer has been on my watch list for some time.

The recent Anglo American dip really tempts me. The mining giant has fallen 7.82% over the last week, as global recession fears grow. Yet its long-term share price trajectory is positive, as it has grown 106.79% over five years.

The stock looks dirt cheap, trading at just 4.5 times earnings and yielding 8.99% a year. I need to do further research, but this looks like the type of dip I could happily buy.

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Harvey Jones doesn’t hold any of the shares mentioned in this article. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Most of my portfolio hails from the FTSE 100 but I like to get out of my comfort zone and look at smaller, fast-growing tech stocks too. That’s why I was intrigued to see a list of five mid-cap tech stocks from the FTSE 250 and AIM being talked about.

They were highlighted by John Moore, senior investment manager at wealth manager Brewin Dolphin. 

Moore says the UK market isn’t renowned for high-growth tech companies but notes that those it has have attracted several buyers lately. “Avast is set to merge with NortonLifeLock. A private equity group is weighing up a bid for Darktrace. Schneider Electric is looking at Aveva. Latterly, MicroFocus has been acquired by Canada’s OpenText.”

These UK tech stocks are worth exploring

Moore has picked out five hidden UK tech gems trading at comparatively cheap valuations, that could fill the void. We’re told that “they have been quietly plying their trades for years, building momentum that could see them become the next generation of UK tech stars.”

His first pick is Oxford Nanopore, which develops nanopore sequencing products for the electronic analysis of single molecules. The name seems vaguely familiar, that’s because disgraced fund manager Neil Woodford included it in his ill-fated portfolio.

The stock began well after its September 2021 flotation, then got caught up in this year’s tech meltdown. It is down 37.83% six months. This £2.38bn market cap stock looks good value at 11.83 times earnings. This year’s troubles could prove a buying opportunity for braver investors.

GB Group operates in the fast-growing ID and fraud prevention services market. Moore notes that it’s a favourite of AIM and small-cap managers, including Liontrust, Aegon, and abrdn. A US private equity firm has reportedly already tabled an offer for the company. Its stock has jumped 31.13% in a week. It might be a bit late for this one.

AIM-Listed Next Fifteen Communications Group is a collection of data businesses that operate across advertising, software engineering and media buying. Its £907m market cap offers growing room, although this year’s planned £310m takeover of rival M&C Saatchi foundered when the Next Fifteen share price sank.

Moore also picked out Belfast-based software, IT, and resale consultancy Kainos Group. Its share price is up 400% over five years but down 27% over 12 months. The company, which has a £1.7bn market cap, is on course to deliver pre-tax profits of £62.7m-66.5m this year.

I’d start with £1k then build up

His final choice is AIM-traded Kape Technologies, a £959m digital security and privacy market specialist. Its shares have struggled this year, but it has raised between $110m and $200m for acquisitions. It trades at 14.34 times earnings.

Naturally, tech growth stocks like these are risky, and I would only buy them with a small part of my portfolio. Thankfully, I already have plenty of big mainstream stocks, thanks to my FTSE 100 dividend income holdings.

Of these five, Oxford Nanopore and Kape Technologies catch my eye. I’ll be keeping an eye on them and I’d start small by investing £1k in each, then top them up if all goes well.

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Harvey Jones doesn’t hold any of the shares mentioned in this article. The Motley Fool UK hasn’t recommended any of the shares mentioned in this article. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.