2 UK shares to buy right now

Rupert Hargreaves explains why he’d buy both of these UK shares, which are both embarking on plans to boost growth in the years ahead.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Entrepreneur on the phone.

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

I think two of the best UK shares to buy right now are Tate & Lyle (LSE: TATE) and Cranswick (LSE: CWK). 

There is a simple reason why I would buy both of these stocks for my portfolio today. In an uncertain world, one thing is certain, that is the fact that humans will always need to eat. Tate and Cranswick both produce and supply food products.

As such, I think these are some of the most defensive UK shares on the market right now. 

Further, it looks as if both firms offer an attractive package of income and growth

Defensive UK shares 

Tate is one of the UK’s oldest listed companies. It is currently overhauling its business model for the next stage of growth. 

The group recently announced that it would be splitting itself in two by selling part of its business. 

The so-called NewCo will take over the firm’s plant-based products for the food and industrial markets. Meanwhile, the legacy Tate business will remain a global food, and beverage solutions operation focused on faster-growing speciality markets. 

Management believes that by refocusing the business, the company will be better positioned to capitalise on consumer demand for healthier food and drink, which the global pandemic has accelerated.

As part of this deal, Tate will receive £0.9bn from the sale of its interest in the NewCo. Of this, management has earmarked £500m that will be returned to investors. The firm will use the rest to pay down debt and fund growth initiatives. 

One of the best shares to buy now 

Cranswick is also revisiting its business model as it looks to the future. The company, which produces a range of predominantly fresh food products, has been investing to increase output and improve its ESG credentials.

Last year, the company spent £72m on new production facilities, including £25m on a breaded poultry facility in Hull and a £20m cooked bacon facility. 

In addition, nine of its sites have achieved carbon neutral certification. It also retained its Tier One status in the global Business Benchmark on Farm Animal Welfare for the fifth consecutive year. 

These are the main reasons why I believe these are some of the best UK shares to buy right now. Not only are the two companies investing for the future, but they are also focusing on some of the most central growth themes around right now. These include the rising demand for healthy, high-quality food with a low carbon footprint. 

That said, both organisations do face some enormous challenges. Food production is highly specialised and regulated. If either firm is found to be compromising on quality, reputations could take a huge hit. 

Further, the industry is incredibly competitive. Just because Cranswick and Tate have succeeded so far does not mean that they will continue to do so. 

Still, despite these risks, I would buy both stocks for my portfolio today. As well as their growth potential, both stocks offer an attractive level of income. Shares in Cranswick currently yield 1.8%, while Tate yields 4.2%, excluding the potential special dividend. 

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Rupert Hargreaves 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.

More on Investing Articles

Investing Articles

Could the JD Sports Fashion share price double in the next five years?

The JD Sports Fashion share price has nearly halved in the past five years. Our writer thinks a proven business…

Read more »

Bus waiting in front of the London Stock Exchange on a sunny day.
Investing Articles

If interest rate cuts are coming, I think these UK growth stocks could soar!

Falling interest could be great news for UK growth stocks, especially those that have been under the cosh recently. Paul…

Read more »

Investing Articles

Are these the best stocks to buy on the FTSE right now?

With the UK stock market on the way to hitting new highs, this Fool is considering which are the best…

Read more »

Petrochemical engineer working at night with digital tablet inside oil and gas refinery plant
Investing Articles

Can the Centrica dividend keep on growing?

Christopher Ruane considers some positive factors that might see continued growth in the Centrica dividend -- as well as some…

Read more »

Smiling family of four enjoying breakfast at sunrise while camping
Investing Articles

How I’d turn my £12,000 of savings into passive income of £1,275 a month

This Fool is considering a strategy that he believes can help him achieve a stable passive income stream with a…

Read more »

Person holding magnifying glass over important document, reading the small print
Investing Articles

2 top FTSE 250 investment trusts trading at attractive discounts!

This pair of discounted FTSE 250 trusts appear to be on sale right now. Here's why I'd scoop up their…

Read more »

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.
Investing Articles

3 things that could push the Lloyds share price to 60p and beyond

The Lloyds share price has broken through 50p. Next step 60p? And then what? Here are some thoughts on what…

Read more »

Young female business analyst looking at a graph chart while working from home
Investing Articles

£1,000 in Rolls-Royce shares a year ago would be worth this much now

Rolls-Royce shares have posted one of the best stock market gains of the past 12 months. But what might the…

Read more »