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UK share investing: 2 top stocks I’d buy in my Stocks and Shares ISA

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I’m still on the hunt for top UK shares to buy in 2021. Here are two I’d very happily buy for my Stocks and Shares ISA today.

Dividends are making a comeback

I won’t say that housebuilders like Redrow (LSE: RDW) don’t carry their share of risk right now. The pulling of the stamp duty holiday after March is already affecting home prices in the UK. New-build properties could also suffer from a long and painful economic downturn caused by Covid-19 and Brexit turbulence.

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Britain’s huge homes shortage still leads me to believe, however, that new-builds built by the likes of Redrow will remain popular in 2021. This shortage has helped propel this UK share’s order book to record highs of £1.3bn as of December. And the company’s decision to reinstate dividends earlier this week illustrates its bright outlook despite dire economic conditions.

Hand holding pound notes

Leaving this UK share on the shelf

I wouldn’t buy shares in FTSE 100 grocer J Sainsbury (LSE: SBRY) though. Yes, food retail is usually one of the safest places to park your investment cash during economic downturns. We can’t do without eating even when the going gets tough, right? Amd the Sainsbury’s bottom line could continue to benefit from Covid-19 lockdowns stretching long into 2021 too, as Britons spend even more time cooking at home.

But I wouldn’t buy any UK supermarket shares like this. I talked in a recent piece about Tesco, saying rising competition (both online and in the physical world) is putting increasing strain on the Big Four supermarkets. This is true for Sainsbury’s. It just announced plans to slash the prices hundreds of products. The move will see the Footsie firm match German discounter Aldi on some 250 items like meat, dairy, and fruit and veg. And it will put even more pressure on the company’s wafer-thin margins. I don’t see this race to the bottom ending well for Sainsbury’s.

A better ISA buy?

I’d be much happier to buy JD Sports Fashion (LSE: JD) stock for my ISA instead. Though that’s not to say that this UK retail share doesn’t face dangers of its own. Soaring demand for athleisure has lit a fire under the FTSE 100 company’s share price in recent years. But fashion changes quickly and JD could fall out of favour quite quickly. In addition to this, the sportswear chain is also enduring a worse-than-expected rise in costs due to Brexit trade issues.

On the plus side, sportswear companies like Nike and Adidas have helped shape fashion trends for decades. And their immense influence in an era dominated by social media means that they should continue dictating what we wear, keeping shoppers flocking to the likes of JD. Meanwhile, I’m also encouraged by the UK retail share’s aggressive expansion programme, one that is making a huge splash in Europe, Asia and more recently the US.

A Top Share with Enormous Growth Potential

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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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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK owns shares of and has recommended Nike. The Motley Fool UK has recommended Redrow and Tesco. 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.