Investment in the stock market is always a risky business. The value of your shares can go up or down, and you can never be sure about the market’s future. However, certain UK stocks have been doing well in recent years and are expected to continue to do well in the future.
If you’re wondering about investing in the UK stock market, you have come to the right place. This post will tell you about the 10 best stocks to buy now in the UK.
However, before we suggest specific UK shares to buy, it’s essential to know how you should evaluate and find the top-performing stocks. There are specific indicators and elements that you need to keep in mind, including both fundamental and technical ones.
While it is impossible to predict a stock price or trend accurately, analysis and background research will help you make an informed investment decision. Keeping that in mind, we will also provide relevant information regarding our top 10 best stocks to buy now in the UK.
Table of Contents
Top industry analysts combine two techniques when they assess any stock performance – Fundamental Analysis and Technical Analysis.
Fundamental analysis tells you about a company’s financials from both quantitative and qualitative perspectives. The analysts look into various aspects of the company, including its earning power, profitability, solvency, and growth prospects. They also compare the company’s financials with its competitors.
Remember that share prices can be influenced by other factors, such as global economic conditions, company news, etc.
Some factors and indicators which you should consider when doing fundamental analysis are as follows:
There are quite a few financial ratios you should consider while doing a fundamental analysis of a company. The most important ones are:
Make sure you compare the financial ratios with the same industry, relevant industry, and key competitors. In some cases, you may also compare them with the index the company belongs to.
The management of the company and its history are two fundamental aspects you must look into. You need to find out how the company has been performing in the past and how its management has handled different situations. A robust and dynamic management can help a company navigate difficult business situations.
A company’s earnings give you an insight into its profitability and prospects. Look for companies that have been reporting consistent growth in their earnings.
You need to ensure that the products and services are in demand and that the company has a competitive edge.
Look at their ongoing projects and R&D activities to determine whether the company’s products and services align with the future business climate.
You should also look at the company’s position in its respective industry. Is it a market leader or a laggard? A market leader usually has a first-mover advantage, which gives it an edge over its competitors. A business needs to outplay the competition either in terms of quality or in terms of price.
This is where technical analysis comes in. Look at the company’s share price performance over the past year or two. Look for companies that have shown consistent growth in their share prices. This indicates that the company is doing well and is expected to do well in the future.
To understand and evaluate share price performance further, proceed to technical analysis.
Technical analysis is the study of past market data to identify trends and predict future market behaviour. Technical analysts believe that the collective actions of all the participants in the market, such as buyers and sellers, influence the market’s direction.
Technical analysis includes the following factors and indicators:
A support level is the price level at which demand is thought to be strong enough to prevent the price from falling further. This is because buyers become more willing to buy the stock as the price falls, and this increased buying activity prevents the price from falling below a certain level.
A resistance level is the opposite of a support level. The price level at which selling is thought to be strong enough to prevent the price from rising further. This is because sellers become more willing to sell the stock as the price rises, and this increased selling activity prevents the price from rising above a certain level.
A trend line is a straight line that connects two or more price points on a chart. Trend lines identify whether a stock is in an uptrend or a downtrend. Uptrends are defined as a series of higher highs and higher lows. Conversely, downtrends are defined as a series of lower highs and lower lows.
A moving average is used to smooth out price action and to identify the direction of the underlying trend. Moving averages are calculated by taking the average of a given set of prices over a certain period of time. The most common time periods are 10, 20, 50, 100, and 200 days.
Candlestick patterns are used to identify potential reversals in the market. The most common candlestick patterns are the hammer, the inverted hammer, the shooting star, and the doji.
As technical analysis requires solid in-depth technical understanding, it is often a good idea to follow analysts’s ratings of buy, sell or hold signals.
Some people believe that analysts are biassed as they work for banks or other financial institutions that could benefit from people buying or selling a particular stock. However, analysts’ ratings actually matter and are often quite accurate.
When considering analysts rating, keep a few things in mind:
Some excellent sources of analysts’ ratings where you can get updated recommendations on UK shares to buy include investing.com, Motley Fool, Capital.com, and HL.
We have researched extensively based on fundamental and technical analysis to recommend the best stocks to buy now in the UK. We have included several industries in our list to help you diversify your portfolio and mitigate risks.
| Company Name | LSE Code | Industry | Market Cap | P/E Ratio | Analysts’ Rating | Indices |
|---|---|---|---|---|---|---|
| Shell plc | SHEL | Oil & Gas | £167.5 billion | 5.91 | Buy | FTSE 100 |
| Bridgepoint Group | BPTB | Manufacturing | £2.46 billion | 32.55 | Strong Buy | FTSE 100 |
| AstraZeneca | AZN | Medical | £161.40 billion | -159.09 | Buy | FTSE 100 |
| Barclays plc | BARC | Finance | £26.65 billion | 5.62 | Hold | FTSE 250 |
| BP plc | BP | Oil & Gas | £82 billion | -8.76 | Strong Buy | FTSE 100 |
| Avast plc | AVST | Information Technology | £7.54 billion | 31.34 | Buy | FTSE 100 |
| BAE Systems plc | BAES | Industrials | £24.29 billion | 17.58 | Strong Buy | FTSE 250 |
| British American Tobacco plc | BATS | Tobacco | £78.05 billion | 14.63 | Strong Buy | FTSE 350 |
| Reckitt Benckiser Group plc | RKT | Household Products | £46.43 billion | 15.05 | Strong Buy | FTSE 100 |
| FRASERS plc | FRAS | Specialty Retail | £3.73 billion | 13.54 | Buy | FTSE 250 |
Shell plc, a British-Dutch oil and gas company has over 110 years of rich business experience globally. Headquartered in London, Shell is listed in stock exchanges of the UK, the USA and Europe.
Product and services:
Recent Highlights:
Considering Shell’s continued innovation and focus on green energy and global sustained energy demands, we believe Shell is one of the best UK shares to buy.
Bridgepoint Group is a British multinational private equity firm. It is one of the largest private equity firms in Europe, with over £28 billion of funds under management. The pension fund is the largest portion of Bridgepoint’s managed fund at 54%.
Product and services:
Recent Highlights:
Bridgepoint has been making innovations to their funding portfolio. Based on our fundamental and technical analysis, we can tell that BPTB is one of the best UK shares to buy now.
Tremendous success with the Covid-19 vaccination project has made AstraZeneca, a research-based biopharmaceutical company, a global household name. It is now one of the world’s largest pharmaceutical companies and one of the UK’s top 10 companies.
Product and services:
Recent Highlights:
AstraZeneca has been progressing well to carry their success of Covid-19 vaccines to other programs, making it one of the top shares to buy now in the UK.
Barclays plc is a British multinational bank, one of the world’s largest banks with over 20 million clients personal banking and card services. The client base includes over a million business banking clients and entrepreneurs.
Product and services:
Individual services include digital banking, borrowing, insurance, credit cards, savings, and investments.
Recent Highlights:
Considering the solid industry reputation of Barclays plc, it is one of the good UK shares to buy.
BP plc is a British multinational oil and gas company and one of the world’s seven oil and gas “supermajors”. BP has been working hard to make the UK energy-independent by increasing home-grown energy production and efficiency.
Product and services:
BP’s current product line-up includes air fuel, bioenergy, global energy trading, mid-market partnership business, marine, shipping, solar warranty, target neutral renovations, retail brands (ampm), gas stations (Aral), lubricants, fuel cards, and credit cards.
Recent Highlights:
BP’s sustainable business practices have made it one of the best UK sharey.
Avast plc is a British multinational cybersecurity software company, the world’s largest cybersecurity business with over 435 million global users.
Product and services:
Recent Highlights:
Avast is among the top 10 UK stocks to buy, considering the sustained demand for online security products in the coming years.
BAE Systems plc specialises in defence, security, and aerospace technology. They focus on improving the security of national, infrastructure, and business properties.
Product and services:
Recent Highlights:
Close collaboration with the US armed forces and continuous R&D have made BAE Systems one of the top UK stocks.
British American Tobacco (BAT) plc is a leading UK-based global consumer goods manufacturer with a great emphasis on tobacco products. They have also been producing vapour-based electronic cigarettes for several years, which do not create any smoke.
Product and services:
Recent Highlights:
Given its business fundamentals, BAT is one of the top UK shares to consider.
Reckitt Benckiser Group plc is a global household name for consumer products. The British multinational company has over 50,000 employees globally.
Product and services:
Reckitt’s most popular brands are Clearasil, Enfa, Finish, Lysol, Veet, Dettol, Air Wick, Durex, Calgon, Mortein, Nurofen, Strepsils, Vanish, Harpic, Airborne, Move Free, Neuriva. The company primarily focuses on hygiene, health, and nutrition products.
Recent Highlights:
Reckitt has been one of the few global companies that have been successful during the difficult Covid-19 years. Their strong fundamentals and high-in-demand product line up has made them a top choice as UK share.
FRASERS plc is a top UK-based sporting goods retailer maintaining a diversified portfolio of lifestyle, sports, and lifestyle products in over 20 countries globally. They have distribution centres, retail stores, and eCommerce websites throughout the US, Europe, and Asia.
Product and services:
Some of the ruptured Frasers brands are 18montrose, Evans Cycles, Flannels, Frasers, Game, House of Fraser, Jack Wills, Sofa.com, Sports Direct, and USC.
Recent Highlights:
Industry analysts forecast rising demand for fashion apparel in the post-Covid time, which is good news for Frasers plc.
The top stocks vary depending on the industry. Typically, you should always invest in companies with great fundamentals and solid business history. Some of the best shares to buy now UK include Shell, AstraZeneca, Barclays, BP, and Reckitt Benckiser.
Some good companies to invest in the UK include Royal Dutch Shell, AstraZeneca, Barclays, British American Tobacco, Avast, BP, and Reckitt Benckiser.
Before buying shares, you should always consider the company's fundamentals and business history. In addition, you should also keep an eye on the company's share price and whether it is undervalued or overvalued.\
It is difficult to predict which stocks will go up in the future. However, some stocks that are expected to do well in the future include Royal Dutch Shell, AstraZeneca, Barclays, British American Tobacco, and Reckitt Benckiser.
There is no such thing as a "safe" stock. All stocks are risky, and the value of your shares can go up or down. However, some stocks are less risky than others. For example, shares of large companies with solid fundamentals and a long history of profitability are typically less risky than shares of small companies with no history of profitability.
Introduction The beginning of blockchain technology has started a new period for different business areas,…
Cryptocurrencies rose from obscurity to making global headlines in just 15 years. Bitcoin is the…
Online gambling has become a booming industry in recent years, witnessing an influx of players…
The online gambling landscape is witnessing a seismic shift with the integration of blockchain technology,…
Dive into the Digital Gold Rush: Bitcoin, the New Investment Frontier!
Riding the crypto wave, Bitcoin becomes global zeitgeist!