2 FTSE growth stocks to buy as the US market becomes almost uninvestible!

For me, the current exchange rate makes long-term investments in the US a no-go. That’s why I’m looking at these two FTSE stocks for growth.

| More on:
A GlaxoSmithKline scientist uses a microscope

Image: GlaxoSmithKline

There’s a couple of reasons why I favour the FTSE over any other index right now. One of them is valuations. UK-listed stocks just haven’t been that popular amid concerns about the general health of the economy and Brexit.

But now there’s the exchange rate to think about. A year ago, £1 got me around $1.40. But the pound has got weaker and the dollar stronger. Today, £1 gets me $1.20, and some analysts think the pound may drop over the next couple of weeks to $1.15.

So, why is the exchange rate important? In the long run, I foresee the pound being a stronger position than it is now. If I invested in a US stock now, and the pound appreciated 10% over the next three years, then it would wipe 10% off the value of my investment.

As a result, I’m looking at UK-listed growth stocks instead of the NASDAQ. So, here are two of my top UK growth stocks I’d buy now.

Kropz

Kropz (LSE:KRPZ) is an Africa-focused phosphate rock mining company. Rock phosphate is the raw material that’s used to produce phosphate fertilisers. The company is looking to play a major role in the food industry in the decades to come. 

The company’s main asset is in Elandsfontein, South Africa’s Western Cape province. Kropz hopes to produce rock phosphate from its Elandsfontein mine later this year. However, it has already been forced to delayed its first bulk sale, which is now forecast later this year.

Around 85% rock phosphate is used in fertiliser production. And it might not be a bad time to be entering the market as fertiliser prices have gone sky-high on the back of higher fuel prices.

Kropz also says that the Hinda rock phosphate asset in Republic of Congo could be “one of the world’s largest undeveloped sedimentary-hosted phosphate reserves“.

I’m a little concerned about when first production will be. And it’s worth noting that there’s a sizeable spread between the buying and selling price. Nevertheless, I see this stock as a good long-term investment.

Ceres Power

Ceres Power (LSE:CWR) is a fuel cell and electrochemical technology developer. There is clearly a lot of potential for any player in this area.

The company has been moving fairly slowly, but there are signs this stock might be about to take off. The AIM-traded firm recently announced that the completion of a China-focused joint venture with Bosch and Weichai Power was now expected to take place in the second half of the year.

Fuel cells won’t only be used in cars, but everything from powering homes to supporting massive cloud data centres. In partnership with Weichai, Ceres has developed a unique electric vehicle (EV) range extender system, using its SteelCell product, delivering high levels of efficiency and with very low emissions.

In June, Ceres Power also announced the signing of an agreement with Shell to deliver a megawatt-scale solid oxide electrolyser demonstrator in 2023. It will be used at Shell’s research and development technology centre in Bangalore where the hydrogen will be used in industrial processes on site. Such products could have huge potential in remote facilities or construction sites, such as Saudi’s NEOM project.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be considered so you should consider taking independent financial advice.

James Fox has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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

Mixed-race female couple enjoying themselves on a walk
Investing Articles

UK shares: 1 burgeoning tech stock to buy for returns and long-term growth!

Jabran Khan is looking for the best UK shares to buy for his holdings that provide excellent returns and growth…

Read more »

Black father holding daughter in a field of cows
Investing Articles

2 FTSE 100 shares I’d buy for lifelong passive income!

These FTSE 100 shares have proved to be excellent dividend stocks for many years. Here's why I think they'll continue…

Read more »

Young brown woman delighted with what she sees on her screen
Investing Articles

1 cheap penny stock that boosts passive income and has great growth prospects!

This Fool likes this penny stock that currently looks good value for money, has an enticing dividend yield, and growth…

Read more »

Sun setting over a traditional British neighbourhood.
Investing Articles

Will the Taylor Wimpey share price rebound soon?

The Taylor Wimpey share price has jumped 10% since it bottomed last month. But will it continue its rally and…

Read more »

Middle-aged white man wearing glasses, staring into space over the top of his laptop in a coffee shop
Investing Articles

Should I buy this growth stock at £10?

The ASOS share price has tumbled to its lowest price in the last 10 years. Surely at £10 per share,…

Read more »

Middle-aged white man pulling an aggrieved face while looking at a screen
Investing Articles

Is the bear market in stocks over? I fear not!

After the worst first-half bear market in 52 years, US stocks have rebounded in the past month. But what should…

Read more »

Happy male couple looking at a laptop screen together
Investing Articles

Is this FTSE 250 stock one of the best to buy for consistent growth and returns?

Jabran Khan takes a look at whether this FTSE 250 tech stock could be a good addition to his portfolio…

Read more »

Girl and father putting coin into piggy bank, sitting on sofa at home
Investing Articles

Here’s why I’d buy Legal & General shares to bag 7.5% dividends today

Legal & General shares are picking up, as the company reaches the halfway stage in its five-year cash and dividend…

Read more »