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Best UK shares to buy now? Why I’d go for these

If you are looking for the best UK shares to buy now you have many to choose from. But I’d start by focusing on the quality of the underlying business and its ability to keep on paying a regular and rising stream of shareholder dividends.

We can’t argue with dividends. They represent a tangible return for shareholders, and it takes cold, hard cash to pay for them. Unlike earnings that can dance up and down to the tune tapped out by an accountant’s pencil, cash flow is hard to fudge. And dividends prove the existence of cash.

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Quality marks the best UK shares to buy now

But these are extraordinary economic times. So should we be investing in shares on the stock market at all? I’d answer that question with a resounding ‘yes’. It’s almost always a good time to invest and to be invested if you are holding quality merchandise in your portfolio. To me, the risks of being out of the market far outweigh the risks of being in it.

The primary risk of sitting on the sidelines is you could miss the next rally in shares. Indeed, bull markets tend to begin when we least expect them. And it’s been said many times that the stock market tends to climb a wall of worry. Just look at the mighty bounce-back for many shares that started right after the spring crash. There was plenty to worry about in the economy, but shares blasted off on a rocket-like bull run anyway.

Meanwhile, Bank of England chief economist Andy Haldane is recently on record describing the recovery in the economy as “so far, so V”. But he acknowledges plenty of risks ahead. So the wall of worry stands as tall as ever. One possibility discussed by economists is that recent economic data reveals a release of pent-up demand rather than the start of an ongoing recovery. 

Why I think it’s time to buy

However, even if economic activity doesn’t improve much from current levels. I still think it’s a good time to buy shares now. One thing to consider is that shares are not the economy. Indeed, the stock market is known to be a leading indicator. And that’s because investors are always looking months ahead to where the economy and the operations of underlying businesses are going. Share prices tend to move before operations and the economy catch up. That’s one reason why bull markets seem to spring from nowhere.

There’s still an opportunity to pick up quality shares at marked-down prices. And if you adopt a long-term investing horizon, investments you make today could do well over the coming years. For example, I like the look of clothing, footwear, accessories, beauty and home products retailer Next.

The FTSE 100 company is a household name with both online sales and a store estate. I reckon it’s on course to survive the pandemic and thrive afterwards. And using ‘quality’ as my watchword, I’d also focus in on soft drinks company Britvic and premium alcoholic drinks supplier Diageo. To me, these three are among the best UK shares

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Kevin Godbold has no position in any share mentioned. The Motley Fool UK owns shares of Next. The Motley Fool UK has recommended Britvic and Diageo. 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.