Which Stocks To Buy Now In U.K? Investing in the stock market has long been a popular method for individuals and institutions to grow their wealth. In the United Kingdom, with its vibrant and dynamic economy, the stock market presents a plethora of opportunities for investors seeking to capitalize on potential growth and generate returns. However, with numerous companies and industries to choose from, selecting the right stocks to buy can be a challenging task.
Best British stocks to buy and hold
1. Experian
Experian has been a Foolish favourite for a long time. The primary reason for this is the business’s position in the market as the world’s largest credit bureau, which has data on around 1.3 billion people globally that lenders use to determine creditworthiness.
This industry has extremely high entry barriers, and the data given is extremely valuable to clients such as banks – two types of leverage that Experian’s management team continuously converts into strong pricing power. Operating margins varied from 23.2% to 24.6% throughout the five years to fiscal year 2022, with a very good 32.3% return on equity in the most recent fiscal year. Experian is a high-quality corporation, as seen by that last number.
Origins of Experian
Experian traces its roots back to London in 1980 when it was established as CCN Systems. It underwent multiple mergers and acquisitions, eventually evolving into Experian as we know it today.
Key Milestones
Over the years, Experian has achieved significant milestones, such as pioneering the use of credit scores and expanding its operations globally. With a presence in over 37 countries, Experian has become a leading player in the credit industry.
Credit Reports and Scores
One of the primary services Experian provides is credit reports and scores. Individuals can access their credit history and scores, enabling them to monitor their financial health.
Identity Theft Protection
Experian offers identity theft protection, helping individuals safeguard their personal information and respond quickly to any suspicious activity.
Business Credit Services
For businesses, Experian provides services to assess the creditworthiness of potential clients, partners, and vendors. This is crucial for making informed decisions and mitigating risks.
2. Hargreaves Lansdown
The end of the pandemic-era retail investing mania and 2022’s bear market were a double whammy for the UK’s largest online share dealing service. But while financial year 2022 was a dud for the company, it’s worth taking a step back and appreciating that even in a bad year, this was a company with operating margins north of 45%.
And having built the market leader in online share dealing, management aren’t resting on their laurels but are instead aiming at the next frontier: reinventing wealth management in the UK. They see an opportunity to take share in this even larger market by winning over customers with less jargon, lower fees, and better advice. If this strategy is successful, it could yield many more years of steady growth and high shareholder returns. And if it doesn’t, the company should still be the highly profitable and cash generative market leader in its core business. Not a bad position to be in.
What is Hargreaves Lansdown?
Hargreaves Lansdown is a renowned financial services company based in the United Kingdom. Founded in 1981 by Peter Hargreaves and Stephen Lansdown, this platform has established itself as a leading player in the investment and asset management industry. It provides a comprehensive range of services, making it a one-stop destination for those looking to manage and grow their wealth.
The History of Hargreaves Lansdown
To truly understand the impact and reliability of Hargreaves Lansdown, let’s take a quick trip down memory lane. The company’s journey started with a handful of employees and a vision to simplify investing for everyone. Over the years, it has grown exponentially and now serves millions of clients across the UK. Its commitment to innovation and customer-centric approach has been the driving force behind its success.
3. Rightmove
Few Britons will be unfamiliar with Rightmove, the UK’s number one property portal by a country mile. As of H1 2022, third party estimates said the company’s market share was 84% – an astounding figure.
Management have turned that market share into an incredibly profitable and cash generative business. In 2021, operating margins were 73.4%. That’s not a misprint. Operating margins for this business are where gross margins for many admired software businesses are. And this was far from a one-off as outside of pandemic-impacted 2020, 70%+ margins have been the norm for going on a decade.
While the housing market is facing very real headwinds, which will affect Rightmove, in the long-term we think owning such a valuable piece of property as the country’s leading property portal could be a good option. And thus far, Rightmove’s managers have proved more than capable of turning that asset into sustained shareholder returns.
4. Britvic
Unlike these first three selections, Britvic probably isn’t a name most members of the public will recognise. But they’ll surely know it’s products. Its own beverages include Robinsons and J20, while it is also the exclusive UK maker and distributor for Pepsi products. But this isn’t a UK-only business, and it pairs long-standing operations in Ireland and France with a presence in fast-growing markets such as Brazil as well.
Producing and distributing soft drinks may not be the most exciting business out there, but Britvic’s capable management team have turned it into a reliable money spinner. And there could be even brighter days ahead as the recent completion of a major upgrade programme to its production, warehousing and distribution network is beginning to bear fruit in rising margins and cash flow. That increased cash flow is already coming back to shareholders via increasing dividends and a new share buyback programme, which is great to see.
5. Compass Group
Like Britvic, Compass Group is not a household name, but most people will have eaten the company’s food. That’s because Compass is the world’s largest caterer, providing on-site food for businesses, schools, hospitals, stadiums, senior living facilities, and even offshore oil rigs and military bases.
The pandemic was tough for the company as stadiums, schools and many offices were shut for months on end. But the company has rebounded with aplomb, revenue is now above pre-pandemic levels, and management believe the company’s growth prospects are now significantly higher than they were before Covid-19.
And with the business back on firm footing, management are not only plowing cash into growth opportunities but have also restarted dividends and the company’s long-standing share buyback programme.
Compass Group is a multinational contract foodservice and support services company headquartered in Chertsey, Surrey, England. The company was founded in 1941 and has since grown to become one of the world’s largest food service providers.
A Brief History of Compass Group
Compass Group’s journey began during World War II when it was founded as Factory Canteens Limited. Over the years, it went through various mergers and acquisitions, eventually adopting the name Compass Group in 1987. Today, it operates in over 45 countries.
Compass Group’s Core Services
Compass Group offers a diverse range of services, including catering, vending, cleaning, and facility management. Its services cater to various sectors, including healthcare, education, business, and sports and leisure.
Global Presence of Compass Group
With operations spanning across the globe, Compass Group serves millions of customers daily in numerous countries. Its international footprint and expertise make it a formidable force in the industry.
Compass Group’s Key Competitors
In the competitive food service industry, Compass Group faces competition from companies like Aramark, Sodexo, and Elior Group. However, it has maintained its position as a leader through innovative solutions and high-quality services.
Sustainability Initiatives by Compass Group
Compass Group is committed to sustainability and responsible business practices. The company focuses on reducing its environmental impact, sourcing ethically, and supporting local communities.
Compass Group’s Clientele
The company’s clientele includes a wide range of organizations, from hospitals and schools to corporate offices and sports venues. Its ability to tailor services to the unique needs of each client is a key strength.
6. B&M European Value Retail
Few UK-listed companies benefited from the pandemic as much as B&M did. While competitors were closed for months on end during lockdowns, B&M’s doors were open due to selling both general merchandise and a huge selection of food products. That led to sales growing more than 45% between 2019 and 2021, with an even larger jump in profits.
Those pandemic-boosted periods have come to an end, but the company has emerged from that period in a very strong position. Brand awareness grew significantly as droves of shoppers were forced to shop with the company while competitors were closed. And many of them have stuck around. That’s led to much higher sales per store, which has driven profits per location up significantly and also allowed management to up their long-term target for B&M brand stores to 950 in the UK, 35% higher than today.
Add to that its successful Heron Foods business that is also growing quickly across the UK, plus the now profitable and fast-growing B&M France business, and the group has enviable growth prospects. And that’s before we consider the possible boost sales could receive from the cost of living crisis as shoppers who are keen to trim their spending turn to discounters like B&M that offer own brand and name brand goods at unbeatable prices.
7. Porvair
Against the FTSE 100 and FTSE 250 giants mentioned above, Porvair is a relative minnow with a market cap of roughly £300m as of February 2023. But being small is no impediment to being a successful business.
Porvair has a 10-year record of growing revenue by a compound annual growth rate of 8% and adjusted earnings per share by 13%. The company has achieved that success by making filters for a range of critical processes, such as keeping out contaminants in aeroplane fuel tanks, ensuring water quality by filtering out contaminants, or containing radioactive material at nuclear power plants.
Porvair’s products end up in an even wider range of applications than mentioned above, but every market the company targets has two key characteristics in common: the filter’s quality being so critical to the process that operators aren’t going to opt for cheaper but untested providers, and high regulatory scrutiny that means operators will regularly replace filters on a scheduled basis.
Porvair, a name synonymous with innovation and excellence, has played a pivotal role in various industries for decades. This article takes you on a journey through the fascinating world of Porvair, exploring its history, product range, sustainability initiatives, and future prospects. Join us as we uncover the significance of Porvair in today’s rapidly evolving world.
Porvair’s History and Evolution
Founded in [year of establishment], Porvair has a rich history that mirrors its journey from a humble beginning to a global leader in filtration and separation technologies. Over the years, Porvair has consistently pushed the boundaries of innovation, setting new industry standards along the way.
The Importance of Porvair in Various Industries
Porvair’s influence extends across a diverse range of industries, including pharmaceuticals, aerospace, environmental protection, and many more. The company’s cutting-edge filtration products and solutions have become an indispensable part of modern manufacturing and research.
8. Croda
Croda is a specialty chemical maker whose main markets are consumer care products like makeup and fragrances and life sciences like pharmaceutical and crop science applications. While all chemical companies are exposed to general economic conditions to some degree or another, Croda is in a good position as these two markets are fairly defensive.
Not only are Croda’s end markets less cyclical than many, but the company’s focus on high value add specialty products means higher profitability. Over the trailing twelve months to H1 2022, operating margins were a robust 23.9% and cash flow was also strong enough to re-invest substantial sums in future growth drivers as R&D and further increase the company’s steadily growing dividend.
9. Airtel Africa
Airtel Africa is one of Africa’s largest telecoms providers, with operations across 14 countries including huge markets such as Nigeria, Kenya, and the DRC. The company offers consumers traditional telecoms services such as phone calls, texting, and data packages, as well as its Mobile Money service.
The latter is a very interesting, high-growth business that gives customers the ability to hold money digitally, make domestic or international transfers, pay bills, buy things online, and more. This side of the business still generates much less revenue than Airtel Africa’s traditional telco services, but it’s growing extraordinarily quickly, is already highly profitable, and has the potential to continue growing by leaps and bounds as the company’s markets experience population growth and demand for these financial services grows.
The company’s exposure to sometimes volatile political environments is a very real risk, but with high present-day income in the form of a high dividend yield and long-term growth potential, Airtel Africa is an interesting combination of growth and income.
10. British American Tobacco
British American Tobacco pays a high dividend yield, and management have finally begun a substantial share repurchase programme. Both of these methods of shareholder returns are comfortably funded by the company’s incredible cash flow that also covers deleveraging and investments in new categories such as its Vuse vape brand.
The investments made in growing non-traditional nicotine products are, of course, necessary for the business and all its competitors as rates of traditional smoking decrease across the most profitable markets. These investments are loss-making, but BAT is targeting break-even for this unit by 2025, and if they can continue growing at a rapid clip while also generating profits, Big Tobacco may not be the industry in terminal decline that is has appeared to be for decades.
British American Tobacco (BAT) is a renowned name in the global tobacco industry. Established in 1902, the company has a rich history and a strong presence worldwide. In this article, we will delve into the intricate details of BAT, exploring its history, product portfolio, sustainability efforts, regulatory challenges, marketing strategies, and much more.
History and Evolution of BAT
British American Tobacco traces its roots back to the early 20th century when it was formed through a merger of several tobacco companies. The company’s journey has been marked by growth, acquisitions, and diversification. Over the years, BAT expanded its presence to different parts of the world, making it one of the largest tobacco companies globally.
Global Presence and Market Share
With a significant global footprint, BAT operates in more than 200 countries, serving millions of consumers. It holds a substantial market share in several key markets, including the United States, where it owns Reynolds American Inc. The company’s international reach makes it a major player in the tobacco industry.
BAT’s Product Portfolio
BAT’s product portfolio includes a wide range of tobacco and nicotine-related products. From traditional cigarettes to modern alternatives like e-cigarettes and heated tobacco products, the company caters to diverse consumer preferences. This diversified approach has helped BAT maintain its competitiveness in a rapidly evolving industry.
Sustainability Initiatives
In recent years, BAT has made significant strides in adopting sustainable practices. The company is committed to reducing its environmental impact, promoting responsible farming practices, and addressing social issues related to tobacco farming. BAT’s sustainability initiatives reflect its dedication to a more sustainable and ethical future.
