2 top shares to buy during a market sell-off

The time to be optimistic is when everyone else is selling. And our writer thinks he’s found two great shares to start buying.

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It’s easy as pie to get down about the state of my portfolio right now. So, I’m looking around the market for top stocks to buy in an effort to cheer myself up.

Here are two that have really caught my eye.

Experian

Like many UK-listed companies, credit checker Experian (LSE: EXPN) is having a pretty lousy 2022. As I type, the shares are down 28%. That gets my attention.

Yes, there are risks here. It’s reasonable to suppose that a slowdown in spending will mean a reduced need for its services. Put simply, there’s no need to check a person’s repayment history if they’re not applying for loans and cards.

On the other hand, it’s also logical to think that this is precisely the time when people and businesses will be seeking credit in an effort to cope with higher energy bills. So, perhaps trading will prove resilient?

Regardless, Experian’s shares now change hands at a price-to-earnings (P/E) ratio of 21. While not screamingly cheap at face value, we need to put this in context. It’s five-year average on this metric is a heady 31. Seen from this perspective, the current price looks like a cracking deal for a company that consistently generates fat margins compared to other stocks in the FTSE 100.

Another bonus is the income on offer. A very affordable-looking, near-2% yield also means I’m being paid to be patient.

Rightmove

A second top stock to buy, at least in my opinion, is property portal Rightmove (LSE: RMV). Like Experian, this firm is having a rotten 2022 with shares tanking 39% as I type. Quite a lot of this fall has only come in the last month as the market has become jittery over how further hikes in interest rates will impact the housing market.

I’m not about to say that the market is overreacting here. With people already struggling with higher energy bills, it’s logical to suspect that moving to a new property won’t be high on their agendas. That could impact profits at housebuilders, building suppliers, and, frankly, any company involved in the sector.

Despite this, Rightmove is the sort of stock I’d be looking to hoover up on such concerns. As an online business, its costs are way below those of your typical bricks and mortar-related firm. Returns on the capital — essentially what a company gets back for the money it puts in — are consistently among the highest in the whole UK market. Theoretically, this should help my money compound at a better rate compared to a business that throws cash around but for little benefit. Speaking of cash, Rightmove’s finances look seriously robust.

At 21 times forecast earnings, shares in this market leader are also substantially cheaper than their five-year average (32 times). Lovely!

Buyer beware

As interested as I am in acquiring shares in Experian and Rightmove, one needs to be aware that their prices may continue falling for some time to come. Given this, it might be better for me to commit to drip-feeding money into these stocks.

That said, I wonder how much pain is already priced in. With markets in an absolute funk, it won’t take much good news to bring out the bulls. Adopting a long-term perspective will also help.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has recommended Experian and Rightmove. 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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