According to one of my portfolio trackers, my Stocks and Shares ISA has outperformed the FTSE All Share Index by 46% this year. That’s great to hear, but it’s not a perfectly calculation, especially as the tracker doesn’t know exactly when I bought and sold my respective investments.
Moreover, while my relative outperformance is good to see, I need to think about what’s going to happen next. With the stock market getting really hot in places, I’ve actually sold some of my most successful investments, including long-held positions in AppLovin and Celestica (still in my daughter’s portfolio and up 1,500% and 1,000% respectively), and shorter trades like Rocket Lab and TTM Technologies.
So, where am I investing next? Well, the stocks on my watchlist now are a little different to the tech-oriented multibaggers I usually aim for.
Yü Group
Yü Group (LSE:YU) is a UK-based business energy and utility supplier to SMEs and corporates. It offers electricity, gas, and water services.
While you’d normally hear energy and think resilient utilities company, Yü is an interesting one because its share price surged 10 times between mid-2022 and early 2024. It’s been more stable since. The driver was rapid expansion of meter points and higher average contracted revenue per meter.
With the share price flattening over the past year, it appears that the value proposition is once again improving. It trades at 7.5 times forward earnings, with that figure falling to 7.1 times in 2026. It’s also got an attractive dividend proposition, with the yield sitting at 4.5% and rising to 4.8% in 2026.
What’s more, the company is currently sitting on a net cash position of £109m. That’s hugely significant for a company with a market cap of just £266m. On a net-cash adjusted basis, it’s trading at just 4.5 times net income for the coming year.
However, there are still risks. This includes exposure to bad debt in the SME space and energy price volatility. Nonetheless, it’s high on my watchlist and worth considering.
Innovative Aerosystems
Innovative Aerosystems (NASDAQ:ISSC), formerly Innovative Solutions & Support, develops flight displays and avionics systems for commercial and military programmes.
Recent performance has been transformed by the acquisition of Honeywell’s F-16 product line, which helped more than double quarterly revenue and pushed backlog to $72m. Alongside this, the firm is tripling manufacturing capacity through its expanded Exton facility, supporting management’s target of delivering over 30% revenue and EBITDA (earnings before interest, tax, depreciation, and amortisation) growth versus 2024.
The stock had surged earlier in the year, but now trades 65% below its peak. The valuation also looks undemanding. It trades on a forward price-to-earnings (P/E) ratio of 13.5, falling to 11.3 in 2026 and 8.1 in 2027 as earnings scale. The P/E-to-growth (PEG) ratio is just 0.31. The balance sheet also looks strong.
As always, there are risks. Gross margins have slipped to 35.6% due to integration costs, and management expects a temporary dip in F-16 revenue during the facility transition.
But looking at the valuation, this is definitely one for my watchlist — I certainly think it’s worth considering.
