A new tax year has begun, giving Stocks and Shares ISA investors like me a fresh £20,000 annual allowance to play with. Here are several stocks I think are among the best for me to buy now.
The new normal?
I believe investing in firms that let people work from home could be one of the hottest games in town. According to Claire McCartney, senior policy advisor at the Chartered Institute of Personnel and Development (CIPD): “The pandemic has shown that ways of working that previously seemed impossible are actually possible.”
In fact, a recent survey by the CIPD shows 71% of employers thought worker productivity had either improved or stayed the same during home-working periods. And a third of the 2,000 respondents said that productivity has increased.
It’s also no surprise that the report showed many respondents plan to change their working practices. A whopping 63% said they plan “to introduce or expand the use of hybrid working to some degree.”
No video nasties
Huge progress in IT and communications has allowed people to work from home en masse during the pandemic. It might not be a surprise then that these are the sort of shares I think are some of the best stocks to buy to ride the flexible working theme.
The use of video conferencing and calling has been a popular substitute for traditional face-to-face workplace interaction in the past 12 months. Indeed, to ‘Zoom’ someone has now become part of the modern lexicon. But share investors don’t need to buy that US share or Microsoft (of Microsoft Teams, naturally) to seize on this opportunity.
LoopUp Group is an AIM-quoted stock that’s an expert in the business of cloud communications (for the uninitiated, the ‘cloud’ refers to servers that can be accessed from anywhere and thus allow people to work from home). And I’d happily buy it for my ISA. Be aware though, LoopUp is tiny compared to its US rivals and could ultimately be crowded out.
More of the best stocks to buy
There are many other UK shares that offer cloud-based services to companies and individuals. Softcat, for example, builds hybrid infrastructure systems that blend the use of data centres with private clouds. It offers a variety of other IT services too. But the rise of cyber attacks pose a serious threat to future earnings. A breach of its systems that result in client damage could seriously damage its reputation.
I also think investing in semiconductor maker IQE is a good idea. This is because companies will need to buy hardware to enable their employees to work flexibly in large numbers. Demand for the chipsets used in data centres is poised to increase too.
While changes in its end markets could see this UK share’s products become obsolete pretty fast, I’d still happily buy this UK share for my ISA right now.
Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Royston Wild has no position in any of the shares mentioned. The Motley Fool UK owns shares of and has recommended Microsoft and Zoom Video Communications. The Motley Fool UK has recommended LoopUp Group and Softcat. 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.