The outbreak of Covid-19 and the subsequent stock market crash severely dampened investor confidence. The pandemic disrupted global supply chains and caused significant damage to economies around the world. However, in the aftermath of the sell-off, many global equities rose sharply, even enough to prompt fears over a second crash.
Almost six months on, the damage is still visible. The valuations of many UK companies are still far below their pre-crash levels. What’s more, various businesses face the gloomy prospect of going under. Couple this with a poor economic forecast, the prospect of a second wave of infections, and rising US-China tensions, and the outlook for investors remains poor.
That said, even amid the chaos, certain companies continue to thrive. Their outstanding performance is testament to the resilience of the underlying businesses. Moreover, some look set to continue to prosper despite the harsh economic conditions.
So, as we move into September, I think investors would do well to keep their eye on such companies. After all, they could be the best UK shares to buy moving forward.
One to watch in September
In terms of share price appreciation, one of the best preforming companies over the last six months is AO World. The online-only retailer has profited from a huge sales boom throughout the lockdown period and beyond. In fact, as my colleague James points out, AO World has outperformed the Amazon share price in 2020!
Specialising in household appliances and electricals, I’m confident the company is well-positioned to enjoy a sustained increase in demand. Even as its competitors began to open up, AO hasn’t witnessed shrinking sales. Ultimately, as many consumers continue to avoid the high street, I reckon AO World is a solid buy for both September and beyond.
A second top pick moving forward
Another company I’d consider investing in this coming month is multinational distribution and services company Bunzl (LSE: BNZL). The firm supplies a wide range of consumable products such as food packaging, cleaning and hygiene supplies, personal protection equipment, and healthcare consumables to name just a handful.
Bunzl’s broad customer base is undoubtedly a key strength of the business. For example, during the pandemic, lower profits in the foodservice and retail segments were offset by rising demand from the hygiene, safety, and healthcare sectors. As a result, the company’s shares bounced back strongly from the market crash and could continue to rise moving forward. That said, the shares don’t come cheap, with a price-to-earnings ratio of around 18.2.
Over the long term though, I’m confident Bunzl could be among the best UK shares to buy, thanks to the firm’s healthy balance sheet, strong cash flows, and sustainable business model.
One of the best UK shares to buy now
Finally, I’ll definitely be keeping an eye on property development company Barratt Developments. After being particularly hard hit in the sell-off, the company is yet to make significant headway in recovering its pre-crash valuation (P/E: 7.1). That’s even despite the positive news coming from the FTSE housebuilders.
New home sales, as well as prices, have held up well. In fact, Barratt’s order book appears particularly strong, with sales ahead of this time last year. Ultimately, with a housing shortage yet to be addressed and interest rates at rock bottom, the long-term outlook for property stocks remains favourable.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Matthew Dumigan has no position in any of the shares mentioned. The Motley Fool UK owns shares of and has recommended Amazon and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. 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.