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3 of the best cheap UK stocks to buy in an ISA!

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Who doesn’t love a bargain? While it’s true that the cheapness of many UK shares reflects their poor investment prospects, some of the best stocks to buy today can also be picked up for next to nothing.

Here are three low-cost UK shares I’d happily buy for my own Stocks and Shares ISA today.

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A FTSE 100 giant

A bright outlook for the fast-moving consumer goods (FMCG) industry suggests that Reckitt (LSE: RKT) is a top UK share to buy today. The recently renamed FTSE 100 stock manufactures a broad range of health and hygiene products from lozenges to dishwasher tabs, painkillers to insecticides. And thanks to market-leading labels like Durex, Gaviscon, and Veet, I think Reckitt is one of the best stocks to buy in this arena. Kantar Worldpanel analysts say that the company’s Dettol disinfectant and Harpic bleach were the two fastest-growing FMCG brands in 2020.

Today Reckitt trades on an ultra-low forward price-to-earnings growth (PEG) multiple of 0.3. This is well inside the widely accepted bargain watermark of 1 and below. And it makes the company a great buy in my opinion, despite the fact it will have to invest plenty on product development and marketing to counter the growing threat of smaller, local FMCG producers.

One of the best stocks to buy for growth and income

Urban Logistics (LSE: SHED) is another UK share I think looks too cheap today. At current prices the business — which provides warehousing and logistics services — changes hands on a forward PEG ratio of 0.5. The property company plays a critical role in the booming e-commerce segment where it supplies space and services to retailers, product manufacturers, and transport companies. It is embarking on ongoing expansion too to make the most of its growing market opportunity. Last month it shelled out £22m to purchase new distribution and warehouse spaces in Warrington and Edinburgh.

It’s worth remembering, though, that acquisition involves a certain amount of risk for companies like this, from overpaying for a property to picking one that turns out to be in a poor location. Still, at current prices I think Urban Logistics is worthy of serious consideration. And its enormous 6% prospective dividend yield puts the cherry on the cake.

Metals mammoth

I also think that Sylvania Platinum (LSE: SLP) is one of the best value stocks to buy right now. The metals producer trades on a forward price-to-earnings (P/E) ratio of five times and boasts a dividend yield above 5%. There are a few reasons I’m positive about this UK mining share. For example, its product is used in huge quantities in the manufacture of car exhaust systems to clean up dangerous gases. It’s thus poised to gain from growing green legislation as well as a bounceback in global car production. IHS Markit thinks light vehicle output will rebound 14% in 2021. Bear in mind, though, that improving economic conditions and consequently investor confidence could damage safe-haven demand for precious metals. And this could damage Sylvania’s revenues in the process.

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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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