A UK share I’d buy in my ISA in March for the new bull market

With the ISA deadline approaching, here’s a top UK share I’d buy in my own shares portfolio. I think it could soar in value during the new bull market.

| 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.

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.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

UK share markets have backed up in recent days as fears over the economic recovery have resurfaced. Buyers are thin on the ground as concerns over Covid-19 variants grow. But I for one don’t plan to stop adding British stocks to my Stocks and Shares ISA.

Buying UK shares that continue to struggle around their recent multi-year lows could help me make huge returns. I’m reminded of the significant bounceback which the FTSE 100 and FTSE 250 made in the years following the last significant stock market crash.

The Footsie more than doubled in value in less than a decade following the 2008 banking crisis. And over the same period, the FTSE 250 just about trebled in value. No wonder the number of people who made millions in financial products like Stocks and Shares ISAs ballooned during the last decade, then.

Déjà vu?

Economic recoveries very rarely follow a straight line. And I think it’s possible that the bounceback this time around could be bumpy too as the Covid-19 crisis rolls on. Other issues like Brexit and revived trade wars could hamper the recovery, too. But that doesn’t mean that UK share prices won’t soar again over the next several years.

Indeed, with central banks adopting ultra-loose monetary policy again and more quantitative easing possibly coming down the pipe, there are clear parallels between now and the last bull market of the 2010s.

Stack of new bank notes

This explains why I’ve continued to buy shares in my ISA in recent months. As a long-term investor I’m not overly concerned over the exact timing of the economic recovery. I have faith that the global economy will recover strongly, as it has done following major macroeconomic and geopolitical crises in the past. Profits across UK plc will rebound as a result, and this will pull share prices higher again.

A UK share I’m looking at

Wizz Air (LSE: WIZZ) is one UK share I’m considering buying for my ISA for the new bull market. It’s true that the airline might suffer a slow earnings recovery if Covid-19 infection rates spike again. But I’m one of many who believe the low-cost airline has the financial might to overcome the problem of travel bans persisting long into 2021.

It seems that there’s strong pent-up demand ready to be unleashed from holidaymakers all over Europe. And Wizz Air will be able to ramp up capacity quickly to ride this opportunity. It’s why City analysts reckon the Hungarian airline will flip from losses in the outgoing financial year (to March 2021) to earnings in financial 2022.

There is a risk that Wizz Air’s share price could collapse if the Covid-19 crisis doesn’t begin to improve though. This UK share trades on a mountainous forward price-to-earnings (P/E) ratio of around 190 times for the upcoming fiscal year. Companies that trade on such high valuations are in particular danger of falling should their profits outlooks darken.

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.

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Wizz Air Holdings. 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.

More on Investing Articles

Investing Articles

After it crashed 25%, should I buy this former stock market darling in my Stocks and Shares ISA?

Harvey Jones has a big hole in his Stocks and Shares ISA that he is keen to fill. Should he…

Read more »

happy senior couple using a laptop in their living room to look at their financial budgets
Investing Articles

How’s the dividend forecast looking for Legal & General shares in 2025 and beyond?

As a shareholder, I like to keep track of the potential dividend returns I could make from my Legal &…

Read more »

artificial intelligence investing algorithms
Investing Articles

Could buying this stock with a $7bn market cap be like investing in Nvidia in 2010?

Where might the next Nvidia-type stock be lurking in today's market? Our writer takes a look at one candidate with…

Read more »

Investing Articles

Is GSK a bargain now the share price is near 1,333p?

Biopharma company GSK looks like a decent stock to consider for the long term, so is today's lower share price…

Read more »

Snowing on Jubilee Gardens in London at dusk
Investing Articles

Could December be a great month to buy UK shares?

Christopher Ruane sees some possible reasons to look for shares to buy in December -- but he'll be using the…

Read more »

Young mixed-race couple sat on the beach looking out over the sea
Investing Articles

Sticking to FTSE shares, I’d still aim for a £1,000 monthly passive income like this!

By investing in blue-chip FTSE shares with proven business models, our writer hopes he can build sizeable passive income streams…

Read more »

Growth Shares

BT shares? I think there are much better UK stocks for the long term

Over the long term, many UK stocks have performed much better than BT. Here’s a look at two companies that…

Read more »

British Pennies on a Pound Note
Investing Articles

After a 540% rise, could this penny share keep going?

This penny share has seen mixed fortunes in recent years. Our writer looks ahead to some potentially exciting developments in…

Read more »