As the UK roars back into life, I’ve been searching for stocks to add to my portfolio that may profit from the recovery. I reckon there are a handful of equities that could do just that. As such, here are two FTSE 250 stocks I’d buy in September as the economy continues to recover.
FTSE 250 stocks to buy
The first company on my list is the student housing provider Unite (LSE: UTG). Throughout the pandemic, students and universities have suffered huge levels of disruption. However, it seems as if there’s now a light at the end of the tunnel.
Universities are looking to restart in-person teaching at the beginning of the new year, and students are returning to their campuses. According to Unite’s latest trading update, 83% of rooms are now reserved for the 2021/22 academic year. This is above last year’s level of 81%, but below the pre-pandemic level of 89%.
Still, the numbers are heading in the right direction. Management also believes that if international students return, occupancy levels could return to pre-pandemic levels in the year ahead.
So I’d buy the FTSE 250 stock considering its growth potential. Shares in the firm also offer a dividend yield of 1% at the time of writing, although I expect this to rise as students return.
Despite all of the above, Unite is still at the risk of further lockdowns. These could dent its recovery plans. Additional restrictions on international arrivals may also impact their firm’s recovery. Therefore, I’m not taking anything for granted with this enterprise.
The return of gatherings
C&C Group (LSE: CCR) manufactures, markets and distributes branded beer, cider, wine, spirits, as well as soft drinks. Most of the company’s sales go to trade customers, which hurt the firm last year. Overall, sales dropped 56%. Off-trade sales expanded 14%.
As hospitality’s reopened, C&C’s trade sales have recovered. In its latest trading update, the group noted sales in May had returned to 65% of 2019 levels. I don’t think it’s unreasonable to assume trade has recovered further as the economy has continued to reopen.
And that’s why I’d buy shares in C&C today. The fellow FTSE 250 firm has used the last year wisely. It’s invested in a new IT system, new warehouses and inked several new distribution deals. These initiatives should all help drive the firm’s recovery in the coming weeks and months.
While I’d buy the company as a recovery play, I’m also conscious that the pandemic exposed its weaknesses. C&C relies heavily on trade channels. If pubs are bars are forced to close again, the firm’s sales may also collapse as a consequence. This is perhaps the most considerable risk facing the stock today.
Nevertheless, even after considering this, I’d buy the stock as a recovery play in September.
