Just released: our 3 top small-cap stocks to buy in September [PREMIUM PICKS]

Small-cap shares tend to be more volatile than larger companies, so we suggest investors should look to build up a portfolio of at least 15 small-cap stocks.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Person holding magnifying glass over important document, reading the small print

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

Premium content from Motley Fool Hidden Winners UK

Our monthly Best Buys Now are designed to highlight our team’s three favourite, most timely Buys from our growing list of small-cap recommendations, to help Fools build out their stock portfolios.

“Best Buys Now” Pick #1:

Hollywood Bowl (LSE:BOWL)

Why we like it: “Before Covid, Hollywood Bowl (LSE: BOWL) – the UK’s largest operator of tenpin bowling lanes – was steadily growing revenue, improving margins and returning lots of cash to investors. While progress was scuppered by lockdowns, the company seems to be getting back on track and returning to a position of strength. The business seems to be back to pre-Covid health financially and operationally and we continue to see it as attractive today, with an eye on its long-term potential.

“Hollywood Bowl’s management team has done a great job, consistently increasing like-for-like sales by refurbishing older centres, improving food options, and finding ways to encourage customers to visit more often and spend more per visit. On top of this, there are three main opportunities for future growth: opening one or two new centres annually in the UK, expanding the new Puttstars mini-golf brand, and the latest being its higher risk/higher reward expansion into the large Canadian market.”

Should you invest £1,000 in Vanguard Funds Public Limited Company - Vanguard S&p 500 Ucits Etf right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Vanguard Funds Public Limited Company - Vanguard S&p 500 Ucits Etf made the list?

See the 6 stocks

Why we like it now: Dire prognostications for the confidence of the UK consumer that were front of mind for much of 2021 haven’t exactly panned out in 2022. For sure consumers are feeling the pinch even as inflation cools, but from what we can tell spending on experiences, particularly affordable family friendly ones like bowling, appears to be holding up well. That puts Hollywood Bowl in a good position to continue executing its familiar strategy of steady new centre openings and consistent like-for-like sales growth from its existing centres. It’s early days for the Canadian expansion but signs are positive there as well. FY23 margins will be down year-on-year due to some Covid-19 business relief effects rolling off but in general as long as the year offers up more revenue growth, further significant cash generation, and higher dividends then we think Hollywood Bowl is worth checking out this month at its current valuation.

“Best Buys Now” Pick #2:

Redacted

Want All 3 “Best Buys Now” Picks? Enter Your Email Address!

Pound coins for sale — 31 pence?

This seems ridiculous, but we almost never see shares looking this cheap. Yet this Share Advisor pick has a price/book ratio of 0.31. In plain English, this means that investors effectively get in on a business that holds £1 of assets for every 31p they invest!

Of course, this is the stock market where money is always at risk — these valuations can change and there are no guarantees. But some risks are a LOT more interesting than others, and at The Motley Fool we believe this company is amongst them.

What’s more, it currently boasts a stellar dividend yield of around 10%, and right now it’s possible for investors to jump aboard at near-historic lows. Want to get the name for yourself?

See the full investment case

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.

The Motley Fool UK has recommended Hollywood Bowl Group Plc. 

More on Investing Articles

Aston Martin DBX - rear pic of trunk
Investing Articles

Down 42% in a year, here’s why Aston Martin shares could keep falling

Aston Martin shares have destroyed vast amounts of shareholder value since the company listed in 2018. Are they now a…

Read more »

One English pound placed on a graph to represent an economic down turn
Investing Articles

FTSE shares: a once in a blue moon chance to get rich?

Christopher Ruane explains why he thinks hunting for blue-chip FTSE bargains in the current market could help an investor build…

Read more »

Businessman hand stacking money coins with virtual percentage icons
Investing Articles

4 stocks Fools have bought for growth and dividends

Sometimes, an investor doesn’t have to make the choice between buying a growth stock or dividend shares! Some investments offer…

Read more »

Rolls-Royce's Pearl 10X engine series
Investing Articles

Is there no limit to how high Rolls-Royce shares might go?

Christopher Ruane sees some reasons Rolls-Royce shares could continue pushing upwards. But is he persuaded enough about the potential value…

Read more »

Businessman hand flipping wooden block cube from 2024 to 2025 on coins
Investing Articles

How much could £20k in a Stocks and Shares ISA be worth in 2030?

UK investors have enjoyed spectacular returns in their Stocks and Shares ISA's over the past five years. Would could the…

Read more »

Passive and Active: text from letters of the wooden alphabet on a green chalk board
Investing Articles

Is the FTSE 100 good for passive income?

Our writer considers whether investing in the UK’s largest listed companies could help generate generous levels of passive income.

Read more »

piggy bank, searching with binoculars
Investing Articles

Here’s the growth forecasts for International Consolidated Airlines (IAG) shares through to 2028!

Shares of International Consolidated Airlines (LSE: IAG) have risen following a strong set of first-quarter financials last week. Is the…

Read more »

DIVIDEND YIELD text written on a notebook with chart
Investing Articles

These 10 FTSE income stocks could generate £33,137 a year in dividends

Our writer looks at the highest-yielding income stocks on the FTSE 350 and considers what level of return they might…

Read more »