When I think of deadline day, I usually think of transfer deadline day for football managers. That can often be a chaotic and last-minute rush to secure the best players. Today is ISA deadline day, meaning that, at midnight, my £20,000 allocation resets. I can then use the next 12 months to buy and sell in my Stocks and Shares ISA without incurring capital gains tax.
There’s no need for this deadline day to be stressful. So, with some leftover cash I have, here’s a couple of ISA stocks I’m looking to buy now.
A top performer
Barclays (LSE:BARC) is a large UK-based bank with operations in retail, corporate and investment banking. It’s share price has risen 97% over the past 12 months — the second best-performing stock in the FTSE 100 so far this year.
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Full-year 2020 results shows profit fell 38%, but this doesn’t tell the whole story. The business is well diversified, and so the hit was mainly seen in retail banking. The corporate and investment arm actually grew profits by 35% in what was a record year.
I’d buy this stock for my ISA now because the report showed that the consumer, cards and payment business rounded a corner and returned to profit in the second half of the year. This makes me think consumer spending is starting to normalise after — potentially — the worst of the pandemic is behind us.
The risk with this stock is the low loan-to-deposit ratio. This fell to 71% in 2020. Essentially, if the bank loans out each pound it receives as a deposit, the ratio would be 1. A ratio below 80% isn’t great as it shows the bank isn’t fully utilising the funds available, thus leaving revenue on the table.
Ready for recovery?
The second stock I’d buy for my ISA now is Land Securities Group (LSE:LAND). It’s a real estate investment trust (REIT), meaning it invests in property as a primary feature. It famously owns the Piccadilly Lights in London.
The share price is up 24% over the past 12 months, but suffered a wobble late last year after having to write down the value of the property portfolio by almost £1bn due to the pandemic.
Personally, I think Landsec is still a good buy for my ISA right now because the valuation is only on paper. The company owns property in central London that I think will recover in value in the coming years, so it doesn’t overly concern me.
The 10.3% fall in rental income to the end of Q3 2020 from commercial property is an issue. But I hope this is only a temporary dip. As lockdown restrictions are lifted and the UK economy bounces back, I’d expect rental income to pick up again.
Finding good ISA stocks to buy
The above are two examples of stocks I’d buy for my ISA on deadline day. Given the sectors they operate in, I think they’re sustainable long-term shares to buy.
