Best UK stocks to buy in 2022 part 1

Best UK stocks to buy in 2022 part 1 – that will be the topic of today’s article.

Nothing written here should be considered as financial advice, nor a solicitation to invest. 

For any questions, or if you are looking to invest as an expat, you can contact me using this form, or via the WhatsApp function below.

Introduction:

Have you ever wondered about which UK stocks to buy? Especially as we have entered into a new year, it is a very crucial time to invest in stocks as a part of your financial goals.

If you have thought about it, then you have come to the right place because we will discuss some of the best UK stocks to buy in 2022 in this article.

Best UK stocks to buy now:

Best UK stocks to buy in 2022

As we have entered into 2022, most people would want to find the UK stocks that are considered as the best picks for this year.

Nonetheless, not everyone can get access to this information, and if you belong to such a category, there is no need to worry because we have researched on your behalf so as to provide the details regarding the best UK stock picks for 2022.

There are, however, some factors that influenced our choice while we were choosing the stocks mentioned in this list such as follows:

  • First of all, we must consider the ongoing COVID-19 virus, which is spreading over the world in the form of new variants like the Omicron.

The outbreak of this deadly pandemic led to a rise in tech stocks because of influential aspects such as most employees working from home and people opting for digital entertainment.

Some analysts claim this tech boom to be finished but we might also see some more surge in the tech stocks with the rise of the new variants of the virus.

  • As the world is recovering from the virus, we can also expect a surge in the stocks related to the banking sector because of the increasing interest rates, which makes these types of stocks seem lucrative.
  • when it comes to the negative aspects of the global impact of the Omicron variant around the world, we can expect lockdowns not only in the UK but around the world.

This might influence the sectors of travel, food, tourism, and entertainment to a great extent, and because of that, we might still have to watch out before investing in such stocks.

Based on some of the influential websites providing the best stock analysis, we have found the following stocks to be the best picks for 2022, which are as follows:

Best UK Shares:

We want to start with a disclaimer stating that these stocks have been considered to be the top choices of some of the best analysts, yet you should not consider these to be investment advice.

You should always remember the fact that the investments depend on an investor’s financial goals and other factors that impact their financial health such as risk tolerance, age, financial well-being, etc.

You should never consider these results to be investment advice or expect these stocks to have future results profitable to you, but nevertheless, these stocks have the potential for growth in 2022.

  • Barclays (BARC):
Best UK stocks to buy in 2022

Barclays PLC is a company, which is being traded on the London stock exchange as “BARC” while having a market capitalization of 31.3 billion GBP.

We expect that the Bank of England (BoE) will increase the rates of interest before European Central Bank (ECB) does that, and because of that, all the banks of the Financial Times Stock Exchange (FTSE) seem to be lucrative in terms of providing profits to investors.

However, the impact of Omicron needs to be less such that there won’t be a need for imposing a lockdown for this to happen. For the bank to see more profits, we must assume that the UK avoids prolonged lockdowns so that the bank can have higher interest rates.

Adding to that, Barclays is one of the attractive stocks as the bank seems to outperform because of the anticipated interest rate surge at the BoE.

When compared to the European rivals, Barclays is likely to observe an increase in the interest rates alongside the bank margins, which makes it outperform in the investment side of the business.

  • Whitbread (WTB):

The food chain has experienced some losses in their business because of the outbreak of the Omicron variant of COVID-19, but we must also consider the fact that their business is dependent on domestic demand instead of international travel.

The shares of this company seem to be oversold while experiencing some lows during November 2021, and we should also notice that the shares of the company were 40% lower than the prices before the outbreak of COVID-19.

This can be a good buy now if the lockdowns are not for a significant period in the UK, and if the Omicron variant comes under control within a short period, then this can be a better option for investors.

  • Ashtead (AHT):

Ashtead is an industrial equipment rental company, which experienced a 70% increase in its share price, which was even higher previously during the fourth quarter of 2021.

Ashtead is considered as one of the top gainers of the FTSE 100 index and we should also pay attention to the price-to-earnings ratio of the stock, which is 35 times higher than the average stocks in the FTSE 100 index.

However, it might not be possible to see gains as much as those experienced in 2021, but still, the shares are anticipated to increase on the basis of the company’s performance.

Ashtead happens to be one of the biggest players in the US market, and because of US president Biden’s Build Back Better Bill, we may see a stable increase in the prices of this stock.

By factoring in all the technical indicators, the company’s share price chart is somewhat motivational to investors because it was able to outperform many other businesses despite the outbreak of the Omicron variant.

  • Croda International (CRDA):

Croda International is next on our list, which is a specialty chemicals manufacturer, and experienced gains of around 50% this year.

Similar to the performance of Ashtead’s shares, this company also seems to be encouraging for the investors based on the share price trajectory.

Even though the stock seems to be expensive, it is worthy of the price because of the recent growth in profits and revenues, which seems very optimistic.

At the beginning of 2022, the P/E ratio of this stock is around 55 times, which makes it one of the pricey stocks available.

But the price seems to be having some justification to it because of the profit expectations shared by the company for the second quarter of 2022.

However, some analysts state that it would be better if the investors waited for a dip before they can buy the stock, yet if you are considering long-term, then you can buy it regardless of the dip.

  • Royal Mail (RMG):
Best UK stocks to buy in 2022

This is yet another good buy for the long-term investors because it has seen an increase of 40% in its share prices.

Royal Mail is a letter and parcels delivery company, which is currently seeing a lot of profits because of the e-commerce boom. Last year, the revenue from the parcels has exceeded the revenue from that of the letter, which happened to be the first time.

Since there will be a lot of increase in online shopping in the nearby future, we can expect the share prices of the company to increase even more.

Even though the prices might be disrupted with the outbreak of the virus, the stock is considered to perform better over the long term as most people are starting to opt for online shopping nowadays.

The stock is being traded at a P/E of sub-6 times, and it also pays dividends, which makes it clear that now is the best time to buy the stock.

  • easyJet (EZJ):

It is no surprise to say that almost all the travel stocks have experienced a significant amount of loss since the outbreak of the Omicron variant. This made airlines experience losses while seeing a considerable decrease in their valuation.

Even though there has been a lot of panic among investors because of Omicron, there may not be a possibility for strict travel restrictions, especially in Europe (where easyJet carries out its business).

It has been estimated the share prices of this company are as low as they were in 2012 when we consider the prices before the pandemic outbreak.

Soon enough, the pandemic will pass, and the stock will see a rebound, and therefore, the stocks of easyJet have made it into our list today.

Analysts suggest that the travel sector is likely to experience a setback in the early stages of 2022, yet the same analysts state that the best time to buy a stock is when its prices are low.

Considering this now is the best time to buy travel stocks such as easyJet and hold them for the long term.

  • Fuller, Smith & Turner (FSTA):

This is a somewhat risky asset in our list considering the problems faced by pubs, hotels, and other relevant businesses because of the current scenario.

However, after this whole virus situation comes under control, it is anticipated that the Chiswick firm can expect profits through the increase in commuter hubs, high streets, and tourist hotspots.

Even if it takes time for that, we can consider other potential factors such as low net debt, and the market cap (£416 million) being lower than that of the net assets (£441 million).

Nevertheless, we should be serious about all the factors (both negative and positive) before investing in such types of stocks.

Pained by financial indecision? Want to invest with Adam?

Financial Planner - Adam Fayed

Adam is an internationally recognised author on financial matters, with over 354.2 million answers views on Quora.com and a widely sold book on Amazon

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