Investing alongside you, fellow Foolish investors, here’s a selection of stocks that some of our contributors have been buying across the past month!
Apple
What it does: Apple manufactures consumer electronics – most notably, the iPhone. It also operates the App Store.
By Stephen Wright. Shares in Apple (NASDAQ:AAPL) have been falling since the start of the year for two main reasons. One is declining sales – especially in China – and the other is antitrust concerns.
Both of these are genuine risks, but I think the market is focusing on these slightly too much. In my view, there are some positive factors that are also worth considering at today’s prices.
The most obvious of these is the emergence of artificial intelligence. Apple hasn’t been showing any obvious AI innovations of its own, but it might well stand to benefit nonetheless.
If enthusiasm for AI reinvigorates consumer spending, Apple might well see iPhone sales pick up again. And that could set the company back on the right track in terms of growth.
With regard to the ongoing antitrust concerns, I think it’s too early to tell what the likely outcome will be. But the market seems pessimistic and I’m looking to take advantage of that.
Stephen Wright owns shares in Apple.
Ashtead Group
What it does: Ashtead Group is the second-largest rental equipment supplier in the US with a 13% market share.
By Royston Wild. In recent weeks I sold my shares in Ashtead Group (LSE:AHT) as I rotated capital from my Individual Savings Account (ISA) into my Self-Invested Personal Pension (SIPP).
But I had no intention of staying on the outside for long and bought back in as soon as was possible. This is a FTSE 100 share with a terrific record of earnings and dividend growth.
I believe Ashtead’s investment case is as attractive today as it was in the early 2010s when its bull run began. The US rental equipment sector is highly fragmented, giving the company plenty of scope to continue growing through acquisitions.
In addition, the long-term outlook for the North American construction sector also remains highly encouraging. Hargreaves Lansdown analysts have identified “the onshoring of supply chains” and government legislation “to expand infrastructure and chip manufacturing” as just a few potential earnings drivers in the years ahead.
I think Ashtead is a top buy despite the threat of more share price turbulence in the near term.
Royston Wild owns shares in Ashtead Group.
Computacenter
What it does: Computacenter is a value-added IT reseller. It supplies a wide range of hardware, software and services to large organisations.
By Roland Head. I added FTSE 250 share Computacenter (LSE: CCC) to my portfolio last year and topped up my position recently, following a strong set of full-year results.
Revenue rose by 7% to £6,923m last year while pre-tax profit rose by 9% to £272m. The group also ended the year with chunky net cash of £459m, equivalent to 14% of its market value.
I believe some of this cash could be used to fund a one-off return to shareholders later this year. Even without this, Computacenter’s 20-year dividend growth record and strong market share make it attractive to me.
Although a slowdown in the AI and data centre markets could lead to a slump in demand, Computacenter has a broad customer base and a long record of growth.
In my view, the business still has plenty of room to grow, especially in the US market. Computacenter is a long-term buy for me.
Roland Head owns shares in Computacenter.
ITV
What it does: Founded in the 1950s, ITV is the largest commercial broadcaster in the UK. It also provides streaming and content creation services.
By Charlie Keough. After being on my watchlist for some time, I finally decided to snap up some ITV (LSE: ITV) shares. Down 14.1% in the last year, as I write, I saw an opportunity too good to pass on.
At its current price, it trades on just 12 times earnings. That looks like good value to me. What’s even better is the fact that’s forecasted to fall to nine times in 2025.
I must admit though, what enticed me the most was its 6.8% dividend yield. Covered just 1.4 times by earnings, that could worry some investors.
However, ITV management has reiterated its intentions to keep maximising value for shareholders.
I’m also intrigued to see where the business will go in the years to come as it moves away from traditional advertising, which is a struggling industry, to focus more on digital revenues. ITV has some exciting plans that, if they come to fruition, should help boost its share price.
Charlie Keough owns shares in ITV.
Novo Nordisk
What it does: Novo Nordisk is a Danish pharmaceutical company that specialises in diabetes and weight-loss drugs.
By Edward Sheldon, CFA. Recently, I opened a small position in Novo Nordisk (NYSE: NVO). The reason I did this is that I wanted to get more exposure to the GLP-1 weight-loss drug theme.
I’m quite late to the party with this trade. Over the last year, the stock has risen about 60% on the back of enthusiasm over the potential of the company’s weight-loss drugs (Wegovy, Ozempic, Amycretin, etc.)
Yet I’m convinced that we are just at the start of a long-term growth story here. According to Goldman Sachs, the global weight-loss drug market is set to grow by more than 16 times by 2030 to $100bn.
Now, I did pay a high valuation for this stock. At present, the forward-looking price-to-earnings (P/E) ratio is about 38, which means that if future growth is underwhelming, the stock could underperform.
However, given that my position is small (around 1% of my portfolio), I’m not too worried about this risk.
Edward Sheldon owns shares in Novo Nordisk
RELX
What it does: Global provider of information-based analytics and decision tools to customers in various sectors.
By Mark David Hartley. While looking to gain more exposure to the UK’s artificial intelligence (AI) sector, RELX (LSE:REL) consistently popped up as a good option. With the shares up 32% over the past year, it gives me the impression of a company performing well. Checking the income statement, revenue and earnings have increased over the past year and future return on equity (ROE) is forecast to be ~60% in three years.
One concern is its debt level. At £6.3bn, it’s almost double its equity. This is down from £7.8bn in 2020 but it’s still something I will keep a close eye on. On the balance sheet, there’s been a slight reduction in both assets and liabilities and free cash flow is down 15.8% year on year. With a price-to-earnings (P/E) ratio of 36, the shares may be slightly overvalued now – but I trust in their long-term growth potential.
Mark David Hartley owns shares in RELX.
Shoals Technologies Group
What it does: The company connects solar power to the electrical grid, making it vital in the clean energy transition.
By Oliver Rodzianko. Shoals (NASDAQ:SHLS) is one of the best solar investments I know of at the moment.
It stands out because its electrical balance of system solutions connects solar power technologies to the electrical grid. That makes it vital in making solar power a realistic dominant energy provider over time.
With the World Economic Forum considering solar as the highest growth energy technology in all history, I think the long-term future here is very bright.
However, the public could elect Trump in the coming US Presidential Election. If they do, government subsidies and financing for clean energy infrastructure could go down. That adds to a running theme that there could be short-term losses before long-term gains with an investment in Shoals, in my opinion.
Nonetheless, I’m more excited about my investments in solar energy than any other holdings in my portfolio. I’m happy to play the long game for the big future profits I expect.
Oliver Rodzianko owns shares in Shoals Technologies Group.
Toast
What it does: Toast provides a leading cloud-based restaurant management platform.
By Ben McPoland. I recently invested in shares of Toast (NYSE: TOST). This is a tech company that provides software-as-a-service solutions to restaurants to enable card payments, online orders and the launching of loyalty programmes, among other things.
In this respect, it’s a bit like Shopify, powering all the behind-the-scenes stuff.
Last year, revenue surged 42% to $3.9bn while its annualised recurring run-rate (ARR) – a measure of recurring revenue – increased 35% to over $1.2bn. It processed more than $126bn in gross payment volume.
Over 6,500 net new restaurants were added in Q4 of 2023, bringing the total to approximately 106,000 locations by the end of December. Customers include Marriott International, Choice Hotels and Caribou Coffee.
The firm isn’t profitable yet, which adds risk. However, it is targeting profitability on a GAAP (standardised accounting principles) basis in H1 of 2025. The forward price-to-earnings (P/E) ratio is 33.4 for 2025, which is reasonable for a high-growth stock, in my opinion.
As mentioned, the company has onboarded 106,000 restaurant locations, mainly in the US. But with an estimated 22m worldwide, the long-term opportunity looks very attractive.
Ben McPoland owns shares in Shopify and Toast.
Warpaint
What it does: Warpaint sells affordable branded colour cosmetics to major retailers and via its own website.
By Harshil Patel. I recently bought shares in specialist cosmetics retailer, Warpaint (LSE:W7L). It’s going through a period of strong growth across all its geographical areas.
I wrote about it in October when its share price was trading near £3. Since then, it has climbed higher past £4. And for good reason. It’s making excellent progress and sales for the first quarter of 2024 are around £23.5m. That’s 28% ahead of the same period in 2023.
Its affordable range of cosmetics under the brand names W7 and Technic are proving popular, particular with its younger demographic.
I prefer to own high-quality businesses that offer a strong balance sheet, solid margins and double-digit return on capital employed. And Warpaint ticks all three of these boxes.
Bear in mind that it’s a competitive industry, and peers have deep pockets for marketing efforts. That said, Warpaint seems to be making efficient use of social media and is run by experienced founders.
Harshil Patel owns shares in Warpaint.
