Despite jitters in global stock markets recently, the UK has actually performed relatively well. When I compare the fact that the Nasdaq 100 in the US has fallen almost 25% this year, the fall of 1.5% in the FTSE 100 is much better. With that in mind, I want to turn to the top UK shares that are resilient at the moment to add to my portfolio.
Strong share price gains on the radar
With £1,000 to invest, it makes sense not to put all of my eggs in one basket. I’d rather split it into four lots of £250 and invest in a selection of stocks. I want to pick top UK shares that could outperform for the rest of this year and beyond.
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One of the star performers in the FTSE 100 has been Shell (LSE:SHEL). Over the past year, the share price is up 66%, well above the index average. Even in the short term, the share price has jumped 5.5% over the past month.
The price movement reflects the impressive financial results noted over the past few quarters. If I thought the Q4 2021 adjusted earnings figure of $6.4bn was strong, the $9.1bn Q1 2022 number was even better.
I’m also impressed that the company is using all of this excess profit wisely. It’s reducing net debt and also utilising share buybacks. However, I do need to remember that the company will take on some losses from operations with Russia. I’m also exposed to the volatile nature of oil and gas prices.
A top UK share for passive income
I can identify top UK shares from their historical performances, as with Shell. I can also use a different measure — dividend payments. By analysing the dividend yield of a stock, I can find the best UK shares for income potential.
At the moment, Taylor Wimpey (LSE:TW) has a dividend yield of 6.84%. I recently wrote in more detail about the state of the UK homebuilder. The fall of 28% in the share price over the past year has pushed the dividend yield higher. There are concerns around the departure of veteran CEO Pete Redfern. But I feel the new boss Jennie Daly is an experienced, strong choice. Investors have also been wary about the ongoing cladding scandal, and the bills that could find their way to Taylor Wimpey going forward.
Even with those concerns, I still think it’s one of the top UK shares for me to buy for income at the moment. Homebuilders benefit from certain features that make me confident in this regard. For example, the business has operating profit margins around the 20% mark. This is generous, and means that the firm would need to see a material increase in costs before a profit would be jepoardised.
Second, the long lead time of building and selling a property means that Taylor Wimpey has a forward order book, providing revenue in the tin for months in advance.
I’m looking to use my £1,000 to buy both the top UK shares mentioned, along with others that I find when conducting my homework.