2 stocks I’d invest £1,000 in today

These two shares could deliver impressive dividend returns.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Deciding where to invest any sum of money may seem challenging at the present time. The FTSE 100 has risen to record highs in recent months and many investors may feel there is a lack of value on offer via mid and large-cap shares.

However, as is the case in any market conditions, there are still some stocks that could offer wide margins of safety. Here are two companies which could be worth buying today for the long term.

Inflation Is Coming

Inflation is out of control, and people are running scared. But right now there’s one thing we believe Investors should avoid doing at all costs… and that’s doing nothing. That’s why we’ve put together a special report that uncovers 3 of our top UK and US share ideas to try and best hedge against inflation… and better still, we’re giving it away completely FREE today!

Click here to claim your copy now!

Solid performance

Reporting on Thursday was primary care property investor and developer Assura (LSE: AGR). The company reported a solid third-quarter performance, with it completing the acquisition of 22 medical centres and one development under a forward funding agreement at a combined cost of £84m. This has helped to drive the company’s rent roll to £87.4m on an annualised basis. And with £310m in capital raised in December, the company’s financial position appears to be improving.

Looking ahead, the company continues to see a positive market outlook. Demand for modern buildings is set to remain robust in future years, with the autumn budget recently setting out £10bn to invest in making NHS buildings fit for the future.

With a dividend yield of 4.1%, Assura appears to have a solid income outlook. Its bottom line is due to rise by 6% this year and 8% next year, which suggests that it could deliver further improvements to dividend payments. As such, now could be the perfect time to buy it for the long term, with a resilient and stable business model potentially providing diversification during the current bull market.

Uncertain future

Also offering the potential for impressive income returns is utility company SSE (LSE: SSE). The company reported this week that it continues to offer dividend growth which will match RPI inflation in both the current financial year and next year. This means that its 7.3% dividend yield could become even more enticing over the medium term. With inflation currently less than half that level, the company’s income prospects remain exceptionally attractive.

Of course, SSE faces an uncertain future. It is currently in the process of spinning-off its domestic energy supply business in a combination with Npower. This is expected to complete in the next year and it could create a stronger entity with greater resources. It may also allow SSE to become a more focused and innovative business which is better able to deliver rising dividends in future.

Clearly, the utility sector is highly unpopular among investors at the moment. Political risk remains at possibly its highest level in over a decade, and this could mean regulatory changes are ahead in the coming years. But with such a high dividend yield, the potential for inflation-matching dividend growth and an evolving business model, SSE may offer high total return potential for the long run. As such, it could be worth buying today.

Is this little-known company the next ‘Monster’ IPO?

Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead.

Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025.

The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential.

But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving.

Click here to see how you can get a copy of this report for yourself today

Peter Stephens owns shares in SSE. 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.

Should you invest the value of your investment may rise or fall and your Capital is at Risk. Before investing your individual circumstances should be considered, so you should consider taking independent financial advice.

More on Investing Articles

Playful senior couple in aprons dancing and smiling while preparing healthy dinner at home
Investing Articles

Best British dividend stocks for July

We asked our freelance writers to share the top income stocks they’d buy in July, which included Dividend Aristocrats and…

Read more »

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

How I’d apply the Warren Buffett method to buying shares

Learning from billionaire investor Warren Buffett, our writer explains his own approach to investing in shares for his portfolio.

Read more »

pensive bearded business man sitting on chair looking out of the window
Investing Articles

This dividend share yields under 1% — but I’d still buy it

This dividend share has a low yield. So why would our writer consider adding it to his income portfolio?

Read more »

Young lady working from home office during coronavirus pandemic.
Investing Articles

Looking for a good share to buy? Here’s how I do it

Here are two approaches our writer uses when hunting for a good share to buy for his portfolio to aim…

Read more »

man in shirt using computer and smiling while working in the office
Investing Articles

One cheap FTSE 100 share I’d buy for a new bull market

This FTSE 100 share is unloved and starting to look seriously cheap, says Roland Head.

Read more »

Young brown woman delighted with what she sees on her screen
Investing Articles

How I’d invest £500 in UK shares in 2022

Investing a small amount of capital in UK shares can result in high commission costs. Zaven Boyrazian explains how to…

Read more »

Black woman using loudspeaker to be heard
Investing Articles

2 battered FTSE dividend stocks to buy in July!

I'm still searching the FTSE 100 for the best bargains to buy. I think these two big dividend shares are…

Read more »

Woman pulling baffled face
Investing Articles

Can I trust Lloyds’ 6.1% dividend yield?

The Lloyds' share price has sunk in 2022, causing the bank's dividend yield to leap. But can I really trust…

Read more »