I’m searching for the best cheap shares to add to my Stocks and Shares ISA right now. Here are two FTSE 250 growth stocks I think are too good to ignore following recent share price falls.
Tritax Eurobox
Demand for warehouses and distribution services looks set to balloon as companies keep investing in e-commerce and automation. This is why I’d buy shares in Tritax Eurobox (LSE:EBOX) today.
Rents here are increasing rapidly as supply of these big-box assets fails to keep pace with demand growth. This imbalance is making it easier for the firm to pass on rising operating costs to its customers as well. Like-for-like rents at the firm jumped 5.8% during the six months to March as it hiked rents on 97% of its leases.
A weak development pipeline across the industry suggests that rental income should continue growing strongly, too. Indeed, City analysts think earnings at Tritax Eurobox will grow 21% and 17% in the financial years to September 2023 and 2024.
As a result, the firm trades on a forward-looking price-to-earnings growth (PEG) ratio of 0.7. Any reading below one indicates that a stock is undervalued.
The company’s wide geographic footprint helps reduce risk to its earnings from weakness in one or two nations. It also gives it exposure to the continent’s biggest e-commerce markets (like Germany) as well as fast-growing emerging markets (Poland).
Tough economic conditions in its Mainland European marketplaces could sap rental growth in the near term. Data this week showed the eurozone officially move into recession. But a bright long-term outlook still makes the business a top buy in my book.
Spire Healthcare Group
Private healthcare provider Spire Healthcare (LSE:SPI) is a FTSE 250 growth share I already own. And following recent share price weakness I’m tempted to increase my stake.
This is because demand for non-NHS treatment continues to head through the roof. Turnover here leapt 8.3% in 2022 as patients used medical insurance or paid for their own treatment to escape mountainous waiting lists.
Tough talk from the government about bringing down wait times is failing to yield results. NHS waiting lists actually rose to new highs of 7.4m as of the end of April. No wonder, then, that Spire said last month that “good momentum has continued from the end of last year”.
Shortages of medical staff are a threat to the company’s profits outlook. But things still look rosy here as the UK’s growing elderly population adds further strain to a state healthcare system that’s already on its knees.
City brokers agree. They think earnings growth at Spire will accelerate from 35% in 2023 to 74% next year. I think recent share price weakness represents an attractive dip buying opportunity (the company’s shares currently trade on an undemanding forward PEG ratio of 1.1).
