The Motley Fool

Should I buy these 3 cheap UK growth shares for 2022?

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Image of person checking their shares portfolio on mobile phone and computer
Image source: Getty Images.

I’m looking for the best cheap UK shares to buy for next year. Should I invest in these low-cost stocks?

A tasty growth share

The turbulence striking the Turkish economy poses a risk to DP Eurasia (LSE: DPEU), the master franchisee of the Domino’s pizza brand in Turkey (as well as Russia, Georgia and Azerbaijan). Today the Turkish lira plunged to record lows and more weakness could be expected as the central bank there cuts rates.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

It’s my opinion, though, that DP Eurasia could still enjoy strong profits growth next year. This is because the food delivery segment in its emerging markets is swelling rapidly, and this penny stock has the brand name to exploit this opportunity to the maximum.

City analysts think DP Eurasia’s earnings will leap 322% in 2022. This leaves it trading on a forward price-to-earnings growth (PEG) ratio of 0.1, well inside bargain-basement territory of 1. At these levels I’m seriously considering adding the company to my portfolio.

Cheap for good reason?

2022 growth projections over at De La Rue (LSE: DLAR) have also caught my attention recently. City analysts think earnings here will also rise more than 300% in the fiscal year to March 2022. This leaves the banknote printer trading on a forward price-to-earnings (P/E) ratio of 11 times.

A bleak outlook for cash, however, means I won’t touch De La Rue with a 10-foot barge pole. Technological improvements, from the advent of e-commerce to the development of contactless cards, have smacked note and coin circulation over the past decade. Concerns over infection have hit usage even further since the Covid-19 outbreak last year. And the rise of cryptocurrencies like Bitcoin is further damaging demand for physical money.

It’s why the Bank of England deputy governor recently commented that “cash is going to disappear” in a conversation about central-bank-minted digital currencies. De La Rue’s expertise in areas like passports and physical security labels could offer decent growth opportunities, of course. But in my opinion, these are could be offset by the threat to its traditional cash printing business.

A better cheap UK share

I think buying a gold producer like Serabi Gold (LSE: SRB) is a better idea for me. This particular UK mining share is anticipated to enjoy a 20% earnings rise in 2022. Consequently it trades on a rock-bottom forward P/E ratio of 4.8 times.

Gold demand is soaring today as concerns over runaway inflation and the ongoing Covid-19 crisis rattle investor nerves. Precious metals retailer The Pure Gold Company says the number of people buying its physical bars and coins has leapt recently. Numbers are up 278% in the past four weeks compared to the 2021 monthly average. I’m expecting yellow metal interest to remain strong into next year too, amid predictions that global inflation could head even higher.

That said, I’m mindful that gold prices can go down as well as up. Progress in the fight against the coronavirus, or an intense period of central bank rate rises could put gold prices under severe pressure. Still, it’s my opinion that these risks are reflected in Serabi Gold’s low valuation.

Our 5 Top Shares for the New “Green Industrial Revolution"

It was released in November 2020, and make no mistake:

It’s happening.

The UK Government’s 10-point plan for a new “Green Industrial Revolution.”

PriceWaterhouse Coopers believes this trend will cost £400billion…

…That’s just here in Britain over the next 10 years.

Worldwide, the Green Industrial Revolution could be worth TRILLIONS.

It’s why I’m urging all investors to read this special presentation carefully, and learn how you can uncover the 5 companies that we believe are poised to profit from this gargantuan trend ahead!

Access this special "Green Industrial Revolution" presentation now

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended De La Rue. 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.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.