THE DAILY ENCRYPT

October 4, 2022

Top British stocks for April

We asked our freelance writers to share their top British stock picks for April, including Domino's Pizza and Endeavour Mining. The post Top British stocks for...
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 We asked our freelance writers to share the top British stock they’d buy this April. Here’s what they chose:

Royston Wild: SSE 

The possibility of more extreme stock market volatility would encourage me to buy FTSE 100 stock SSE (LSE: SSE) for April. Soaring inflation in the UK means that many consumers may have to trim their spending. But light and heat are two of the last things people will want to cut down on, meaning profits at companies like SSE should remain rock solid. Utilities shares like this could become popular lifeboats for investors as macroeconomic and geopolitical fears increase. 

I think SSE’s essential operations make it a great investment for investors seeking healthy passive income streams like me, too. Dividend yields here sit at a bulky 5.2% and 5.4% for the financial years to March 2022 and 2023 respectively. 

Royston Wild does not own shares in SSE.

Stuart Blair: National Express

It finally seems that National Express (LSE: NEX) is overcoming the worst of the pandemic. In fact, in 2021, the coach operator managed to report an underlying operating profit of £87m, in comparison to a £50m loss in 2020. At the same time, free cash flow became positive, reaching over £120m. While the dividend has not yet returned, this is expected next year.

Risks include the rising costs, due to soaring prices of oil and wage inflation. But National Express has fully hedged oil through 2022 and 2023, which reduces its current exposure to the high prices. I’ll continue to buy this FTSE 250 stock for my portfolio.

Stuart Blair owns shares in National Express.

Stephen Wright: Endeavour Mining

My top stock for April is Endeavour Mining (LSE:EDV). The company owns and operates gold mines in West Africa. I like this stock because I think that the underlying business has some really attractive qualities.

With mining companies, I look for an ability to extract its product cheaply. Endeavour has one of the lowest costs of operations of any gold miner. The last time I checked, Endeavour’s cost per ounce was around $873. With the price of gold currently at $1,915 per ounce, I think that Endeavour is in a strong position.

Stephen Wright does not own shares in Endeavour Mining.

Zaven Boyrazian: Domino’s Pizza Group

With the pandemic loosening its grip on the world, Domino’s Pizza Group (LSE:DOM) has resumed its traditional double-digit growth in gross pizza sales. And now that the long-standing dispute with franchisees has finally been resolved, the group is primed to boost its total sales to as high as £1.9bn!

What’s more, the digitalisation of operations has simultaneously improved customer experience, as well as profitability. This does make the group more susceptible to cyber-attacks. But with the engine seemingly firing on all cylinders, Domino’s looks like it could be an excellent addition to my portfolio.

Zaven Boyrazian does not own shares in Domino’s Pizza Group.

Rupert Hargreaves: Intercontinental Hotels

My top stock for April is Intercontinental Hotels (LSE: IHG).

This is one of the best companies to play the global reopening trade, in my opinion. Analysts expect the group’s earnings to jump 60% this year and 25% in 2023. Based on these projections, the stock is dealing at an undemanding forward price-to-earnings (P/E) multiple of 20.

Of course, this growth is far from guaranteed. The pandemic is not over yet, and there could be further disruption on the cards for the global economy. Rising prices may also hit the firm’s bottom line.

Despite these risks, I would buy the stock today.

Rupert Hargreaves does not own shares in Intercontinental Hotels.

Christopher Ruane: JD Sports Fashion

With a simple business model, strong brand and large potential market, I continue to like the look of JD Sports (LSE:JD). But the shares have lost around a third of their value so far in 2022 and are down 15% in the past year at the time of writing.

That fall partly reflects concerns of reduced consumer spending hurting revenues and profits. But I think it gives me a buying opportunity in a well-run company with global ambitions. Its brand and retail expertise help set it apart from rivals.

Christopher Ruane owns shares in JD Sports.

Roland Head: HSBC Holdings

I think Asia-focused banking giant HSBC Holdings (LSE: HSBA) could benefit from rising interest rates and the easing of pandemic restrictions over the coming months.

The FTSE 100 bank’s underlying profits returned to 2019 levels last year. I think the changes being pushed through by CEO Noel Quinn should help to support more focused and profitable performance in the future.

The risk of a global slowdown is a concern, as are reports of further lockdowns in China. But I think HSBC shares continue to offer good value, trading below book value with a dividend yield of 4.2%.

Roland Head does not own shares in HSBC Holdings.

Andrew Mackie: Glencore

My top stock for April is Glencore (LSE: GLEN). Having recently hit a 10-year high on the back of soaring base metal prices, analysts have been rushing to upgrade their outlook for this leading commodities producer and marketer.

In its full-year results, it declared a combined dividend and share buyback amounting to $0.30 a share. At today’s price, that equates to an impressive dividend yield of 4.7%.

As institutional investors continue to rotate out of growth and into value stocks, together with many of the 60+ commodities that it produces playing a critical role in the energy transition, I expect to see its share price continue to rise not only this month, but well into this decade too.

Andrew Mackie owns shares in Glencore.

Paul Summers: Polar Capital Holdings

The share price of investment manager Polar Capital Holdings (LSE: POLR) has tumbled in value in 2022 so far, partly due to investors’ sudden aversion to high-growth tech stocks. I’m tempted to begin loading up.

The valuation of 10 times forecast earnings is certainly attractive. Throw in a monster dividend yield of 7% for FY23 (at the time of writing) and a strong balance sheet, and I can think of worse places to leave my capital.

Although a swift rebound in the shares is far from guaranteed, this is one ‘value’ stock I’d be happy to own. 

Paul Summers has no position in Polar Capital Holdings

Andrew Woods: Rio Tinto

My stock pick for April is Rio Tinto (LSE:RIO). This is a mining company specialising in iron ore, copper, and aluminium. It operates in Australia, Guinea, and Brazil.

During the 2021 calendar year, pre-tax profit nearly doubled to $30bn. The firm then paid a record dividend of $10.40 per share.

As commodity prices remain high due to global events, I fully expect this trend to continue, with demand outweighing supply.

What’s more, many metals and minerals mined by the company may be used in decarbonisation efforts, with copper being a central component in electric vehicles.

Andrew Woods has no position in any of the shares mentioned.

Alan Oscroft: Purplebricks

Why would I buy into an estate agent whose share price has crashed over the past 12 months? Well, at the interim stage, Purplebricks (LSE: PURP) revealed a disappointing operating loss. But it reported only a very small underlying EBITDA loss.

Oh, and company insiders have bought up nearly a million shares between them in the past couple of weeks.

It’s obviously risky buying into a property business while inflation is soaring and interest rate rises are pushing up mortgage costs. But Purplebricks’ year ends in April, and I’m cautiously optimistic for decent results.

Alan Oscroft has no position in Purplebricks.

The post Top British stocks for April appeared first on The Motley Fool UK.

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More reading

Is the HSBC share price now too cheap to miss?
3 FTSE 100 stocks I’ll be watching in April
Lloyds vs Barclays vs NatWest vs HSBC — which share price is the most attractive?
3 cheap FTSE 100 shares I wish I’d bought in March
With only 13 days before the ISA deadline, my top 2 FTSE 100 conviction stocks

The Motley Fool UK has recommended Dominos Pizza, HSBC Holdings, InterContinental Hotels Group, and Polar Capital Holdings. 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.

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