2 hot shares to buy for February

Looking to February and beyond, our writer highlights two well-known shares he would currently consider buying for his portfolio.

| More on:

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.

If the New Year already feels a long time ago to you, you are not alone. It has been a frenetic few weeks in stock markets as investors try to suss out whether the tech boom can continue or is in the process of deflating. Looking ahead to February, what shares should I consider buying for my portfolio? Here are two I am thinking about.

Cheers to a potential pub recovery

I have been bullish on pub chain J D Wetherspoon (LSE: JDW) for a while. So far that bullishness has not been shared by the wider market. The Wetherspoon share price has fallen 22% in the past year. It is now 46% lower than in December 2019, before the pandemic hit the headlines — and the company’s business.

5 Stocks For Trying To Build Wealth After 50

One notable billionaire made 99% of his current wealth after his 50th birthday. And here at The Motley Fool, we believe it is NEVER too late to start trying to build your fortune in the stock market. Our expert Motley Fool analyst team have shortlisted 5 companies that they believe could be a great fit for investors aged 50+ trying to build long-term, diversified portfolios.

Click here to claim your free copy now!

So why would I consider adding Wetherspoon shares to my portfolio now?

I think the past couple of years have fundamentally changed some elements of the pub trade. Cost inflation has driven input prices up. I expect them to stay at elevated levels. Staffing problems are acute. Many people have decided that drinking supermarket beer on their sofa is cheaper and perhaps safer than going to a pub. I think the pub trade may never wholly recover from the pandemic even when life is fully back to normal.

But I reckon Wetherspoons, as a well-run, experienced, and competitively priced publican, is likely to do better than some of its competitors in the years to come. Indeed, problems elsewhere in the trade could create new opportunities for the industry titan. As pub restrictions are eased, I think the coming months could see a boom in demand. Wetherspoons still faces a lot of risks. Cost price inflation could hurt profit margins, while supply chain problems could hurt sales if product is unavailable. But at the current Wetherspoons share price, I would consider tucking the company into my portfolio now as a recovery play.

UK growth share on sale

The second company I would consider buying for my portfolio as I look ahead to February and beyond is online fashion retailer boohoo (LSE: BOO). While customers love its clothes changing hands for very cheap prices, shareholders do not feel the same way about its shares.

I see an opportunity for my portfolio in the company’s recent difficulties. Some of what has driven the share price to plunge 70% in the past year is concerns about labour standards at the company’s suppliers. I think that is relatively easy to fix and the company seems to be tackling the issue. Other problems such as cost inflation could be harder to manage, especially as the company operates in the low cost market where price increases can hurt sales. In the long term, though, I expect the company to realign its business model to cope with more expensive material costs. That could lead to improving profitability.

Shares to buy for my portfolio

Both of these beaten down shares attract me. That is not just because their prices have fallen. I like them because I think they both have strong business models that have a sustainable competitive advantage.

I may take advantage of their current share price weakness to add them to my portfolio for February and beyond.

Inflation Is Coming: 3 Shares To Try And Hedge Against Rising Prices

Make no mistake… inflation is coming.

Some people are running scared, but there’s one thing we believe we should avoid doing at all costs when inflation hits… and that’s doing nothing.

Money that just sits in the bank can often lose value each and every year. But to savvy savers and investors, where to consider putting their money is the million-dollar question.

That’s why we’ve put together a brand-new special report that uncovers 3 of our top UK and US share ideas to try and best hedge against inflation…

…because no matter what the economy is doing, a savvy investor will want their money working for them, inflation or not!

Best of all, we’re giving this report away completely FREE today!

Simply click here, enter your email address, and we’ll send it to you right away.

Christopher Ruane has no position in any of the shares mentioned. The Motley Fool UK has recommended boohoo group. 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.

More on Investing Articles

Saucepan on a gas hob
Investing Articles

The Centrica share price is up 65%. Here’s why I sold

The Centrica share price has soared nearly two-thirds in a year. So why has our writer dumped his shareholding?

Read more »

Modern suburban family houses with car on driveway
Investing Articles

As the Howden Joinery share price falls, I’d buy and hold

The Howden Joinery share price has been falling. But Christopher Ruane likes its business model and is weighing adding it…

Read more »

Hand holding pound notes
Investing Articles

The tumbling Persimmon share price means an 11.3% yield! Should I buy?

A falling Persimmon share price has pushed the dividend yield into double-digits. Our writer considers his next move.

Read more »

Innovation and new ideas lightbulb concept 2022
Investing Articles

As stock markets crash, I’d buy these 4 FTSE 100 fallers!

After US stock markets tumbled on Wednesday, the FTSE 100 duly followed suit on Thursday. But falling share prices revealed…

Read more »

Compass pointing towards 'best price'
Investing Articles

A 7.6% dividend yield! Is the Aviva share price a bargain not to be missed?

The Aviva share price has recovered well since the 2020 stock market crash. As one of the top FTSE 100…

Read more »

Hand flipping wooden cubes for change wording" Panic " to " Calm".
Investing Articles

Stock market crash: I’m hunting giants for future gains!

In this latest stock market crash, selling pressure is slamming share prices. But some great company stocks are being crushed,…

Read more »

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.
Investing Articles

With a P/E of just 8, this social media newcomer is a cheap stock pick!

This social media firm looks like a cheap stock pick for my portfolio. For a growing tech firm, it certainly…

Read more »

Passive income text with pin graph chart on business table
Investing Articles

Warren Buffett has been selling dividend stocks. Should I be doing the same?

As Warren Buffett sells out of Abbvie, Bristol-Myers Squibb, and Verizon, our writer wonders whether he ought to be looking…

Read more »