Investor sentiment towards UK shares has suffered significantly in recent months. However, I believe this could be an excellent opportunity for long-term investors to snap up some high-quality businesses at bargain prices.
With that in mind, I’m going to take a look at five UK shares I think could be some of the best deals on the market right now.
UK shares to buy
Technology infrastructure business Computacenter flies under the radar of most investors. I don’t think investors should ignore this IT star.
Over the past five years, its sales have grown at a compound annual rate of 10%. This year, management is expecting growth to be materially ahead of expectations. That suggests the company is in for a record-breaking year.
As the world becomes more reliant on technology, it looks as if Computacenter can maintain its growth trajectory in the years ahead. With the stock trading at a forward price-to-earnings (P/E) ratio of just 22, compared to the sector average of 26, now could be an excellent time for investors to buy into the growth story.
Moving away from the tech sector, I think Rio Tinto may also be worth a closer look. Governments around the world are unleashing huge economic stimulus plans as they try and recover from the coronavirus crisis. As the world’s largest iron ore miner, this could have a significant impact on Rio’s bottom line as demand for the commodity surges.
Right now, the stock is trading at a P/E of 10. Further, the company offers a dividend yield of 6.3%. This makes it one of few UK shares to offer a market-beating dividend yield.
Twin tailwinds
Back in the UK, homebuilder Taylor Wimpey could benefit from rising house prices across the country.
As well as the tailwind of rising prices, the UK housing market remains structurally undersupplied. These twin tailwinds of high demand and rising prices could help the company’s earnings multiply in the years ahead.
The stock is currently trading at a P/E of 9 and supports a dividend yield of 3.3%. As the group has returned excess cash to investors with special dividends in the past, I think this dividend yield understates the company’s true income potential.
Financial services group CMC Markets is one of the few UK shares that may see earnings rise this year. The firm has benefited from increased financial market volatility in 2020. Thousands of new customers have joined up over the past six months, accelerating the company’s expansion. This may provide a tailwind for the business for some time.
Still, despite this potential, the stock is dealing at a forward P/E of just 11.2. It also offers a 4.5% dividend yield.
I don’t think any list of the best UK shares to buy now is complete without including gold miner Centamin. The price of gold has surged in 2020, and continuing economic uncertainty may drive the price of the yellow metal higher in the months ahead.
With its 5.3% dividend yield, cash-rich robust balance sheet, and large profit margins, Centamin provides investors with a way to play the rising gold price and generate an income at the same time.
