The Motley Fool

I think these two FTSE 100 UK shares could help you make a million

Image source: Getty Images

Many UK shares are currently trading at depressed levels. It’s easy to see why investor sentiment towards many FTSE 100 companies is as negative. Factors such as Brexit and the coronavirus crisis mean the near-term outlook for UK businesses is highly uncertain. 

However, these are only short-term headwinds. As such, now could be an excellent time for long-term investors to snap up these blue-chip bargains while the rest of the market is looking the other way.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

UK shares on offer

HSBC Holdings (LSE: HSBA) is one of the largest banks in the world, and one of the most prominent UK shares. Still, despite the company’s advantages, shares in the lender have come under pressure in recent months

Following these declines, shares in HSBC are now trading as a level not seen since the late 1990s.

This is unwarranted, in my view. While the company is facing short-term headwinds, such as the coronavirus crisis and low-interest rates, it’s one of the few genuinely global banks.

This is HSBC’s most significant competitive advantage. Clients can trade across the world and move money through the bank’s accounts without having to open new accounts with other lenders. 

Despite this relatively unique advantage, HSBC is one of the cheapest UK shares. Following recent declines in the lender’s share price, the stock is currently dealing at a price-to-book (P/B) ratio of just a 0.5. That suggests the stock offers a wide margin of safety at current levels. 

What’s more, before the pandemic struck, HSBC was one of the biggest dividend payers of all UK shares. While the bank is currently prohibited from paying dividends, when the crisis is over, I think management will restore the payout. If it’s restored at last year’s level, the stock’s yield may be as high as 6.8%. 

All of the above suggests now could be an excellent time to snap up some shares in this undervalued lender. 

St James’s Place

A handful of other UK shares have similar qualities to HSBC. St James’s Place (LSE: STJ) is one example. This is one of the UK’s most recognised and trusted wealth management brands. 

Its latest trading update seems to prove the point. Net cash inflows rose 2% to £4.5bn in the six months to end-June. That’s highly impressive considering the fact that the stock market experienced one of its worst crashes on record at the end of March. 

That said, like many UK shares, St James’s has been negatively impacted by the pandemic. Profits declined by a double-digit percentage year-on-year during the first half. Still, the firm registered a better performance than most of its FTSE 100 peers. 

Management has been able to keep the company’s dividend as a result, albeit at a reduced level. On current forecasts, the stock will pay investors a yield of 2% this year. That’s below the 4% paid last year, but still attractive considering the current environment.

These qualities suggest St James’s Place may be one of the best UK shares to buy in a diversified portfolio right now.  

A Top Share with Enormous Growth Potential

Savvy investors like you won’t want to miss out on this timely opportunity…

Here’s your chance to discover exactly what has got our Motley Fool UK analyst all fired up about this ‘pure-play’ online business (yes, despite the pandemic!).

Not only does this company enjoy a dominant market-leading position…

But its capital-light, highly scalable business model has previously helped it deliver consistently high sales, astounding near-70% margins, and rising shareholder returns … in fact, in 2019 it returned a whopping £150m+ to shareholders in dividends and buybacks!

And here’s the really exciting part…

While COVID-19 may have thrown the company a curveball, management have acted swiftly to ensure this business is as well placed as it can be to ride out the current period of uncertainty… in fact, our analyst believes it should come roaring back to life, just as soon as normal economic activity resumes.

That’s why we think now could be the perfect time for you to start building your own stake in this exceptional business – especially given the shares look to be trading on a fairly undemanding valuation for the year to March 2021.

Click here to claim your copy of this special report now — and we’ll tell you the name of this Top Growth Share… free of charge!

Rupert Hargreaves owns no share mentioned. The Motley Fool UK has recommended HSBC Holdings. 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.

Our 6 'Best Buys Now' Shares

The renowned analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply enter your email address below to discover how you can take advantage of this.

I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.