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Top stocks for an ISA! 2 cheap UK shares I’d buy today to get rich and retire early

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The stock market crash means that there are a wide range of cheap UK shares available to buy today.

Of course, they are likely to experience volatile performances over the coming months. The economy’s outlook could change significantly depending on news regarding the coronavirus pandemic.

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However, in many cases, the valuations of FTSE 100 shares appear to factor in potential threats. Here are two examples of such businesses that could deliver impressive long-term returns and help an ISA investor to retire early.

An undervalued FTSE 100 stock among cheap UK shares

Despite a rising gold price, miners such as Polymetal (LSE: POLY) appear to offer good value for money relative to other cheap UK shares.

The company trades on a price-to-earnings (P/E) ratio of around 9.5. This seems to be even cheaper when the miner’s forecasts are taken into account. It is due to post a 25% rise in net profit next year. This means that it has a price-to-earnings growth (PEG) ratio of just 0.4, which suggests that it offers a wide margin of safety.

Of course, the gold price may experience a less prosperous period if the economic outlook improves. However, Polymetal’s low valuation indicates that investors are not necessarily anticipating further rises for precious metals prices. This could mean that its share price can move higher to outperform other UK shares after its 40% rise since the start of the year.

The company’s recent half-year results showed that it has become more efficient through lower costs and has increased capital expenditure by 31%. Therefore, it seems to be making progress in implementing its strategy. This could lead to improving financial performance that make its appeal among cheap UK shares even greater.

A FTSE 100 retailer with a sound growth strategy

Next (LSE: NXT) is another FTSE 100 stock that appears to offer investment potential relative to other cheap UK shares. The company’s recent trading update showed that its full-price sales in the third quarter were better than expected. They increased by 2.8%, which meant that the retailer lifted its financial guidance for the full year.

The business has invested across its online operations over recent years. Alongside its store network, this could provide it with the means to evolve as consumers increasingly use home delivery-and-click and collect options. This may allow Next to outperform the wider retail sector, which could lead to improving share price performance.

Looking ahead, the company is forecast to post double-digit net profit growth next year as the economic outlook potentially improves. This means that it trades on a forward P/E ratio of 14. With it offering further growth potential as consumers increasingly move online, it could offer good value for money compared to other cheap UK shares. As such, it may be attractive to ISA investors.

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.

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Peter Stephens has no position in any of the shares mentioned. The Motley Fool UK owns shares of Next. 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.

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