UK shares to buy now: how I’d invest £1,500

Our writer explains how he would invest £1,500 in his portfolio. He’s selected three UK shares to buy now, each of them in very different sectors.

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While the stock market has been performing well overall in the past year, there have been some shares that have been weaker. I now see some of these as presenting a buying opportunity for my portfolio. If I wanted to put £1,500 to work in my portfolio today, I’d choose these three UK shares to buy now and invest £500 in each.

Consumer goods giant

One company whose shares have been in the doldrums lately is consumer goods giant Unilever (LSE: ULVR), the maker of brands such as Lynx and Marmite. Its third-quarter update today seems to have boosted sentiment on the stock in early trading. The company’s sales volumes fell compared to the same quarter last year, but thanks to price increases, sales grew overall.

The group has been battling cost inflation and expects more of this in the future. So far, price increases have helped to mitigate the impact of inflation. But there’s a risk that if cost inflation stays high, further price increases will lead to sales falling. Despite that, I think now could be a good moment to add Unilever to my portfolio. Even after ticking up today, the shares remain 17% below their level of a year ago. But this is a company with global reach and a wide portfolio of premium brands that give it pricing power. With a 3.8% yield and the potential for share price appreciation, I would consider adding Unilever to my portfolio today.

Tobacco giant

Another FTSE 100 member I would consider buying more of for my portfolio is British American Tobacco (LSE: BATS). One of the main attractions for me here is the yield of 8.1%, but I also see some growth opportunities. Tobacco might not be seen as a growth industry, but through consolidation and moving into new tobacco products in recent years, the company has actually been growing its revenues.

I already added to my BATS position recently as I think the price is attractive. It’s only 3% higher than it was a year ago, while the broader FTSE 100 has increased 24% over that period. Clearly many investors continue to harbour doubts about the shares, based on risks such as declining demand for cigarettes in many markets. At the current price, though, I’m willing to accept that risk in my portfolio in return for the yield.

Continued growth prospects

The third company in which I would put £500 of my portfolio funds is JD Sports (LSE: JD). Unlike my other two choices, these shares have soared in the past year, adding 31%. But I think the strong growth story here could make these a prime example of UK shares to buy now and tuck away in my portfolio for years to come.

I like JD Sports because its proven retail formula and expertise has led to a long streak of profit growth, which I think could continue into the future. While the pandemic hurt last year’s results, the company’s interim results showed it storming ahead once more. It has lots of untapped market potential both in the UK and overseas. One risk is that overseas expansion into very competitive markets could lead to lower profit margins. But along with Unilever and BATS, I see JD Sports as strong UK shares to add to my portfolio.

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 considered so you should consider taking independent financial advice.

Christopher Ruane owns shares in British American Tobacco. The Motley Fool UK has recommended British American Tobacco and Unilever. 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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