The September sell-off was a disaster for many UK share prices. I have personally seen my stock and share price ISA take an omnipotent shake in recent weeks. We may not be out of the woods as a much larger macroeconomic threat, such as the supply chain problem that is driving up inflation for China’s property market problems, roaring in the background.
However, as a long-term investor, I am not concerned about the threat of new volatility in the global stock market. I’ve bought UK shares year after year, usually based on what I can expect for at least a decade. And I am confident that the British companies I own will give me a fair return even in the event of a split in the economic recovery and another stock market crash.
Buy 2 of the FTSE 100 Best Cheap Stocks!
In fact, I’m ready to go bargain hunting after the September sale closes. Today, many large companies are trading at rock-bottom prices, which could rocket prices if market confidence is restored. I think there may be two best cheap stocks to buy right now for my portfolio.
An all-round bargain
The Taylor Wimpe (LSE: TW) The share price fell sharply by 15% during September. But speaking as its shareholder FTSE 100 Sure, I’m not worried about the trading approach here. Although the economic situation in the UK is deteriorating, the availability of new homes in the market is still failing to meet demand for a long time. I hope this will continue as well, as a highly competitive mortgage market and huge financial support from home buyers from the government remain.
In fact I’m thinking of buying more Taylor Wimp shares at current prices. It trades nine times in the forward price-to-earnings ratio And Sports yield a huge 5.5% dividend. I think the Bank of England is one of the best cheap stocks to buy, despite the threat that it could raise interest rates to stem inflation. This can have a devastating effect on the homebuyer’s affordability and as a result the builder’s demand for large ticket products.
11.4% dividend yield!
BHP Group (LSE: BHP) is another FTSE 100 priced stock that I can buy for my ISA. The price of diversified mining fell 16% in September, leaving it trading at just seven times the forward P / E ratio. Moreover, at the moment BHP carries a huge yield of 11.4% dividend for this financial year.
It is true that BHP could suffer if the Chinese construction sector suddenly collapses. The firm sources 70% of the underlying EBITDA from iron ore sales. But I would argue that this threat is baked into the undervaluation of the company. I think BHP could prove to be a top buy because the global economy is slowly improving after the Covid-1 crisis and the demand for raw materials naturally increased. As the green technology revolution accelerates, I expect demand for metals such as copper to increase.
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Ryston Wild owns shares of Taylor Wimp. Motley Flower UK has no position on any of the shares mentioned. The opinions expressed in the companies mentioned in this article may differ from those of the authors and therefore the official recommendations we make on our subscription services such as Share Advisors, Hidden Winners and Pro. Here at The Motley Flower we believe that considering a variety of insights makes us a better investor.