UK share markets have recovered robustly following the September sell-off of last week. The FTSE 100 has reclaimed the 7,000-point marker for instance and continues to chug higher.
But that doesn’t mean stock investors like me have missed the chance to go out and snap up some choice bargains.
Indeed, I went dip buying following September’s mini stock market crash. I bulked up my holdings in veterinary services provider CVS Group and logistics giant Clipper Logistics. And I’m still scanning UK share markets for shares I think are too cheap to miss following the correction.
These FTSE 100 shares, for example, are still cheaper than they were at the start of the month. Oh, and they boast dividend yields that soar above the Footsie 3.4% forward average following the September sell-off. Here’s why I’d buy them for my stocks portfolio right now.
7.2% dividend yields
Usually demand for safe-haven gold jumps when macroeconomic worries (like those recent ones about China’s property sector) reach fever pitch. However, the commodity has fallen in recent weeks because of a rising US dollar. The resurgent buck makes it less cost-effective to buy dollar-denominated assets.
Sure, there’s a risk that Polymetal might continue to fall if the greenback keeps picking up traction. I’d argue that at current prices it could be one of the best-valued FTSE 100 stocks to buy. The miner trades on a forward price-to-earnings (P/E) ratio of 9 times and sports a 7.2% dividend yield.
I think Polymetal could bounce back as global inflation rockets, an historical driver of gold prices. And I reckon the UK share could deliver terrific long-term returns as it accelerates development of its world-class precious metal projects.
A FTSE 100 stock with double-digit yields!
BHP Group’s (LSE: BHP) another mining share that provide tremendous bang for a buck. The FTSE 100 firm trades on a forward P/E ratio of 7 times. It carries an even-mightier 11.2% dividend yield too!
BHP’s share price has slumped a whopping 16% since the start of September. This is perhaps no surprise as the risk to its earnings in the event of a property market collapse would be considerable.
The diversified miner sources around seven-tenths of underlying earnings from the sale of iron ore which is used to make steel.
I’d argue that BHP still looks attractive from a risk/reward perspective at current prices however. If a meltdown in China can be averted (progress on which has been made in recent hours) then the firm should make splendid profits from the broader economic recovery over the next few years at least.
And the long-term outlook for its metals like copper is tantalising as spending on green projects (like electric vehicles and renewable energy projects) takes off.
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.
Royston Wild owns shares of CVS Group and Clipper Logistics. The Motley Fool UK has recommended Clipper Logistics. 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.