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UK shares for 2021: I’d buy this dividend stock in my Stocks and Shares ISA right now!

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The uncertain economic environment hasn’t deterred me from investing in my Stocks and Shares ISA. There’s an abundance of top UK shares that’ll deliver enormous shareholder returns in 2021. You just need to know where to look.

Begbies Traynor Group (LSE: BEG) is one perfect UK share for 2021. It doesn’t matter that the British economy is poised for a double-dip recession in the coming months. The insolvency services specialist’s counter-cyclical operations will pave the way for solid profits growth.

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Government data last week showed the number of UK insolvencies soar to 1,228 in December. This compares with 891 the prior month. Meanwhile, the number of company voluntary arrangements (CVAs) more than doubled month-on-month to 45.

The stress on British businesses is likely to grow as Covid-19 rolls on, Brexit-related trade turbulence persists, and the government eventually pulls its furlough support scheme.

Investing for growth

Begbies Traynor’s annual earnings are expected to rise 6% in this fiscal period (to April), according to City analysts. They reckon that profits will leap 28% in financial 2022 too, making it a growth share with terrific staying power.

Hand holding pound notes

The UK share is also continuing on the M&A trail to drive future growth. Today, it sealed the £20.8m purchase of CVR Global, the AIM-listed company’s largest insolvency acquisition to date. BEG said the buy “delivers a significant expansion” of its presence in London and the Southeast, while also giving the business its first office on foreign soil.

The financial services has plenty of financial firepower to keep its acquisition-led growth strategy going. Not to mention to continue raising annual dividends as well. Broker forecasts reckon Begbies Traynor will keep raising yearly payouts for the foreseeable future and this creates bulky yields of 3.2% and 3.4% for financial 2021 and 2022 respectively.

A UK share on my ISA watchlist

Okay, these might not be the biggest dividend yields out there. But income investors need to remember that they sit roughly in line with the broader forward average for UK shares in 2021. They also need to recall that these figures outstrip inflation by a huge margin and are therefore a great way to make your money work for you.

Finally, Begbies Traynor is in great shape to keep raising annual dividends long into the future. The same can’t be said for many other UK shares which have uncertain profits pictures at this time and/or much-weaker balance sheets.

Today, Begbies Traynor trades on a forward price-to-earnings (P/E) ratio of 19 times. This might look a tad toppy on paper. This reading, for example, sails above the forward historical average of 15 times for the FTSE 100.

But I think this UK share is worth every penny of its premium rating. It has the defensive qualities to keep delivering big shareholder returns in an era of Covid-19 and Brexit stresses. And its M&A-led growth strategy should supercharge earnings growth over the longer term.

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Royston Wild has no position in any of the shares mentioned. 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.

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