The stock market has struggled so far this month, but that’s not unusual for September. For investors, it may represent an opportunity to pick up shares more cheaply as the economic recovery continues. I think these are potentially three of the best shares for me to buy now.
Early-stage company backer
As a backer of ambitious early stage companies, IP Group (LSE: IPO) has been in the news as Oxford Nanopore Technologies confirmed its intention to proceed with an initial public offering.
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This ought to be good news for IP Group shares. Yet they appear to be cheap. The FTSE 250 group’s shares trade on a price-to-earnings ratio (P/E) of eight and a price/earnings-to-growth (PEG) ratio of 1.11. These ratios both suggest the shares could be undervalued. Yet there are reasons to be optimistic as the floating of Oxford Nanopore proves.
IP Group is experienced in backing early-stage companies, but there are inherent dangers in the industry. Such companies can be hit and miss and some could fail. But IP Group has a good track record and with the shares being so cheap, it could be one of the best UK shares to buy now. I’ll certainly consider adding it.
Two more on my buy list
Rathbone Brothers (LSE: RAT) is another FTSE 250 company that could have a bright future. Again it comes up looking cheap with a P/E of 12 and a PEG of 0.7. The asset manager is well established in ESG investing, and as this trend towards environmentally and socially conscious investing grows more popular, that positions it well within the asset management industry. It could bring in a lot more customers.
The decision to grow by bolt-on acquisitions is a new development and investors may well like seeing Rathbones beefing up to grow its market share. It currently has around 3.8% of the UK wealth management market.
As an asset manager it has strong margins, which adds to its investment case and, for me, makes it one of the best shares to buy now.
Of course, there are reasons the share price might not do well in the future as other asset managers may grow more quickly, the company could make the wrong acquisitions, or overpay for some.
Yet the potential for improvement in the business means I’m likely to add Rathbone Brothers shares to my portfolio.
Then there’s Sylvania Platinum (LSE: SLP), which strikes me as one of the best shares to buy. I hold the shares already and am keen to add more. Why? First and foremost a falling share price has made these shares cheap. The P/E is three and the PEG is 0.2. For a cash-rich, low-cost producer of platinum group metals (PGMs), including platinum, palladium and rhodium, this is too cheap for me to ignore.
The price of these metals has been falling, which explains the current share price slump and mining is undeniably cyclical and volatile. Yet markets for both palladium and rhodium are forecast to be in deficit this year. The result of this could well be that prices bounce back due to the imbalance between supply and demand.
The share price is volatile and metal prices could keep falling, potentially hurting the share price. But in my opinion, Sylvania Platinum is one of the best UK shares to buy now.