It’s that time of year when UK share investors need to consider what to buy for the new year. Huge uncertainty over the strength and the timing of the economic recovery makes the task more difficult than in many previous years. But this doesn’t mean that stock pickers need to sit on the sidelines. There are still plenty of top-quality shares that should thrive whatever the weather.
Here are three top-quality UK shares I’d buy in my own Stocks and Shares ISA for 2021:
#1: Premier Foods
Mr Kipling and Ambrosia custard manufacturer Premier Foods has proved to be a beacon of stability during a chaotic 2020. You don’t need to be a genius to work out why. Spending on food is one of the more dependable things when economic conditions can go sideways. But this UK share has an additional defensive ace up its sleeve: its heavyweight labels command significant customer loyalty that keep the sales rolling in even when broader consumer spending levels sink.
It’s possible that demand for Premier Foods’s edible goods will pick up in 2021 should the economic rebound kick in, too. Today the business trades on a low forward price-to-earnings ratio of 9 times, leaving plenty of scope for more share price gains in the months ahead.
Top UK shares for dividend lovers
The following UK shares offer added value for bargain hunters right now. Why? They boast market-beating dividend yields as well as rock-bottom earnings multiples:
#2: Gamesys Group
It’s possible that Gamesys Group could be one of the most exciting all-rounders today. Analysts reckon the online gambling giant will add to stratospheric earnings growth in 2020 with a 14% increase next year. This leaves the business trading on a mega-low forward P/E ratio of 8 times. It also leads to predictions of more dividend increases and a chubby 3.5% yield for 2021.
The online gambling market has exploded in recent years, with expansion accelerating in the wake of the Covid-19 outbreak too. I believe this UK share, through its popular brands like Jackpotjoy as well as through ambitious expansion into Asia, will make monster profits on the back of this trend.
#3: Sylvania Platinum
South African mining giant Sylvania Platinum (LSE: SLP) has been a brilliant growth generator for years now. Annual earnings have grown by double- and triple-digits for the past half a decade and City analysts reckon this trend will continue with a 71% rise in this fiscal period (ending June 2021)
Platinum group metals (or PGM) demand has rocketed in 2020 thanks to strong demand for safe-haven commodities. Surging investment demand has subsequently blown revenues at Sylvania higher and underpins those bright earnings estimates. And the UK share can expect industrial demand to rebound strongly (and particularly from the key automotive sector) as economic activity picks up.
Today Sylvania Platinum trades on an ultra-low forward P/E ratio of 4 times. It carries a gigantic 14.5% corresponding dividend yield as well. I think such figures could make the mining ace a seriously brilliant stock for my ISA.
Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.