2 cheap UK shares I’d buy in 2021 for my Stocks and Shares ISA

Here’s two top UK shares I’m thinking of adding to my Stocks & Shares ISA in 2021. I reckon they could help me get rich and retire early.

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I’m looking for more cheap UK shares to add to my Stocks and Shares ISA in 2021. Here are a couple of top stocks on my watchlist today:

A five-star UK retail share

Investing in the retail industry is extremely risky business right now. A combination of Covid-19 lockdowns and weak consumer confidence means that many UK shares might not see the other side of 2021.

That’s not to say that stock investors shouldn’t invest in the retail sector, however. Online-only retailers like Amazon, and ones with considerable e-commerce operations like JD Sports Fashion have very bright futures as the Internet shopping phenomenon takes off. Niche retailers like wargaming specialist Games Workshop and music equipment seller Gear4music can also find protection in their specialist operations.

One other segment that stands to have a spectacular 2021 is the budget retail arena. And this is where B&M European Value Retail (LSE:BME) comes in. This UK share announced last week that like-for-like revenues on these shores rocketed 21.1% in the three months to December. Trading has been so strong, in fact, that B&M has decided to pay a £200m special dividend to its shareholders.

Supermarket aisle with empty green trolley

I also like this UK stock because it is expanding rapidly to exploit this favourable trading backcloth to the max. B&M has 673 shops running the length and breadth of the country right now. It plans to cut the ribbon on an extra 18 stores in the final three months of this fiscal year (ending March 2021). And the company has what it describes as a “healthy” pipeline for financial 2022 too.

City analysts are reckoning that B&M’s earnings will soar 86% year on year in this financial year. And this leaves it trading on an ultra-low forward price-to-earnings growth (PEG) readout of 0.2. This is a UK share with a very bright earnings outlook that stretches well beyond 2021.

The trading titan

Plus500 (LSE: PLUS) is another London-quoted stock I expect to thrive in 2021. It also looks too cheap on paper as, in this case, it trades on a forward price-to-earnings (P/E) ratio of 10 times. Let me explain why.

This UK share operates the largest online trading platform for contracts for difference (or CFDs) in Europe. And it enjoyed a bumper year in 2020 thanks to the colossal amount of volatility on financial markets. Revenues clocked in at a record $872m last year, financials released last week showed, better than it had been predicting just a few months ago

Plus500 has strong momentum going into this new year as well. It says that both client deposits and the number of new customers in the final quarter were double the level recorded in the same 2019 period. This was thanks to the “significant investment” the business has made in marketing technology, it says. With financial markets likely to remain choppy as the Covid-19 crisis extends into 2021, and individuals likely to spend more time at home as lockdowns continue, I reckon this UK share should thrive again in this new year.

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 assessed. Consider taking independent financial advice.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Royston Wild owns shares of Games Workshop. The Motley Fool UK owns shares of and has recommended Amazon. The Motley Fool UK owns shares of Games Workshop. The Motley Fool UK has recommended B&M European Value and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. 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.

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