My watch list contains several UK shares to buy now. But that’s only after doing my own thorough research before pulling the ‘buy’ trigger.
And the list is dynamic because stocks become more or less attractive over time. Sometimes that happens because of the news flowing from a company. Or it could be because of geopolitical events or changing valuations and other factors.
It’s a good time to hunt for UK shares to buy now
Nevertheless, there are almost always UK shares I’d consider buying at any particular time. And that’s perhaps unsurprising considering that some of the most enduring and successful long-term investments can arise because of stock purchases made during uncertain times.
And with the ongoing pandemic, supply chain issues, price inflation, rising interest rates, the war in Ukraine and other issues, times certainly seem uncertain now. But I read that billionaire Warren Buffett has become active in buying stocks recently. And he’s well known for shopping for stocks when the general outlook is murky.
Of course, there’s no certainty about a positive long-term investment outcome from stocks. And that’s true even if I buy when they are assigning a keener valuation to their underlying businesses. Indeed, all shares carry risks as well as positive potential and businesses can suffer any number of operational setbacks when I’m holding their shares.
Nevertheless, I’d aim to mitigate some of the risks by choosing businesses carefully. And I’d focus on the quality of an enterprise and its prospects for growth as well as its valuation — just like Buffett. And I’d embrace the risks of stock ownership to expose my portfolio to the positive potential of shares. Therefore, I’d be keen to invest a £2,000 lump sum in shares now.
2 stocks I’m considering
For example, my list includes the clean-air technology company Johnson Matthey. In April, the firm said it expects the current geopolitical situation to drive a “significant acceleration” towards a net-zero carbon economy. And the “corresponding” investment should position the company for the significant growth opportunities from its sustainable technology portfolio.
Meanwhile, with the share price near 1,872p, the forward-looking dividend yield is around 4.25% for the trading year to March 2023. And a £200m share buyback programme is in full swing, which could help to support the share price.
I’m also keen on RELX, the provider of information-based analytics and decision tools for professional and business customers. In February, the company reported strong results, an improved growth rate and a positive outlook. And it’s another that’s been busy buying back some of its own shares with the intention of spending £500m on the programme this year.
With the share price near 2,425p, City analysts expect the dividend to yield around 2.3% in 2023. The valuation doesn’t appear to be as low as Johnson Matthey’s, but RELX has a strong record of growth and has been a great earnings compounder over the years. I think the situation may continue.
Of course, it’s possible for these companies to miss their dividend estimates. But I see both as potentially solid investment vehicles for a long-term holding period.
