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ISA investing: 3 of the best stocks to buy in May

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It’s clear investors like me need to remain extremely careful before buying UK shares. Okay, prices of British stocks have risen solidly in recent sessions, and the FTSE 100 just burst through 7,000 points again.

But market confidence remains extremely fragile and some of what I consider to be some of the best stocks to buy today could well reverse sharply.

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As things stand though, I think the following UK shares are worthy of serious attention today. In fact, I’m considering adding them to my own Stocks and Shares ISA right now.

One of the best FTSE 250 stocks to buy?

The Morgan Sindall Group share price has gone gangbusters in recent sessions, thanks to strong trading updates of its own. In mid-April, it rocketed to then-new record peaks when it said results for the full year would “significantly” beat expectations.

I’m therefore excited to see what the construction and regeneration group will have to say when it gives fresh details on recent performance on Thursday, 6 May.

Last month, the FTSE 250 company said trading has accelerated since the start of the 2021. No UK share is without risk, of course. And remember that the long-term performance of Morgan Sindall could be compromised by the intense competition in its markets. But I still think it’s a top buy for May.

Another top ISA pick?

I also think buying Mears Group could be a good idea before full-year results come out on Wednesday, 12 May. I’m not expecting anything spectacular to come out of this UK share, which is responsible for managing and maintaining tens of thousands of properties for local authorities and housing associations.

Rather, I’m predicting another solid release that could help its share price to take out recent 13-month highs. Last time it updated the market in March, it praised its “resilient trading and liquidity performance” and said it expected “a full recovery as lockdown restrictions are lifted.”

I think this UK share is a great long-term stock to buy today, but remember that profits could start to flag if Mears Group loses key contracts.

M&A delivers big rewards

In its last trading release in April, Diploma announced its performance in the first half of its fiscal year had exceeded expectations.

News that strong trading has continued when it updates the market again on Monday, 17 May, could give its share price a fresh dose of rocket fuel.

The FTSE 250 share has undergone massive transformation in recent years and recent acquisitions are driving excellent revenues growth at the technical products manufacturer.

Indeed, sales were up 27% in the six months to March. Bear in mind though, that while Diploma’s M&A-led growth strategy is currently paying off, past performance on this front is no guarantee of future success.

Companies can often end up overpaying on acquisitions, while trading in bolt-on buys can also end up ultimately disappointing. For the time being though, progress at this UK share looks good.

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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.

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