Stock markets have been volatile recently. And rightly so, in my view. Russia’s invasion of Ukraine has added a great deal of uncertainty. We’re also experiencing soaring inflation, which may compress profit margins and squeeze consumer spending. But the Stocks and Shares ISA deadline is approaching. So, as a long-term investor, I’ve been sanguine over falling stock markets. It means I can pick up some cheaper shares before the deadline is over!
With this in mind, here are the stocks I’m buying before next month.
A Stocks and Shares ISA investment
I’d first top up my investment in Nvidia (NASDAQ: NVDA), the leading designer of computer graphics cards. Like most share prices, the stock has come under pressure recently and is down by 10% so far this year. I think this may represent a buying opportunity. Analysts seem to think so, too, as the consensus share price target is $338, or 27.5% above today’s share price.
Nvidia benefits from being the leader in computer graphics card design. In fact, the company invented the graphics processing unit (GPU) that is now a crucial component in various high-end computers.
GPUs are also required in advanced technology such as artificial intelligence and autonomous driving. I see these technological trends as being huge catalysts for Nvidia’s growth in the years ahead. As a long-term investor, this does get me excited about buying Nvidia’s shares.
It hasn’t been all good for the company recently though. It failed in its attempt to buy Arm from SoftBank. This was a big disappointment, in my view, as Arm is a leading chip designer focusing on central processing units, or CPUs. It would have diversified Nvidia’s business, and potentially led to quicker growth for the company.
Nevertheless, I’d add Nvidia shares to my portfolio today.
One more stock I’d buy
The share price has been almost in freefall recently though. This year alone the price has dropped 21%. And over one year, the stock is down a huge 41%. It means the shares are valued on a lowly price-to-earnings ratio of 12 based on next year’s earnings forecast. I think there could be some good value here.
Financial performance looks to be improving, too. Revenue is expected to rise by 8% in fiscal year 2023 (the 12 months to 31 March 2023). Net profit is expected to rise by an even bigger 13%, which suggests that margins are improving.
The investment isn’t without risk. Homeserve is undergoing a transformation plan of its UK business as it tries to return it to growth. It’s a key risk to consider because the UK is Homeserve’s most established market.
But for me, I think the risks are full priced into the shares. So I’d buy the company in my Stocks and Shares ISA before the deadline next month.