Latest news with #StocksandSharesISA
Yahoo
7 days ago
- Automotive
- Yahoo
Down 12% in 2 days, is this FTSE 100 growth share now an unmissable buy?
Generally speaking, great companies rarely go on sale. And this is why it can pay to take advantage of any temporary share price weakness. This week, we've seen just that in what may be considered a high-quality growth share from the FTSE 100. It's left me wondering whether I should be raiding the back of the sofa and snapping up what I can, while I can. The stock in question is automotive marketplace platform provider Auto Trader (LSE: AUTO). Despite releasing the sort of full-year numbers most companies would crave yesterday (29 May), its share price has retreated by no less than 12% as I type. At first glance, this seems rather harsh. After all, revenue rose to £601.1m, up by 5% from £570.9m in the previous financial year. The average revenue per retailer — a key metric for the company — rose by the same percentage. Operating profit accelerated 8% higher to a smidgen under £377m. What gives? Like so many things when it comes to investing, it's not about what happened; it's about what people were expecting to happen. In this example, analysts were anticipating that revenue would come in just above £606m. Holders also seemed to be unnerved by management's projections for FY26. Retailer revenue growth of 5% and 7% is expected. Again, this appears to be less than some analysts were hoping for. Despite a strong 2025 prior to results being announced, Thursday's drop leaves Auto Trader slightly down for the year. To compound owners' misery, the company has now delivered a worse return over the last five years than the FTSE 100 index. And that's before I've factored in dividends! There's no rule to say that Auto Trader's price won't continue falling either. This is very possible if the company's prediction that growth will be stronger in the second half of FY26 proves to be wide of the mark. We also need to consider the valuation. A price-to-earnings (P/E) ratio of 22 is more reasonable than it was. However, it's still far from 'cheap' in the conventional sense. But I'll tell you something: I didn't see any indication that Auto Trader's dominant position is under any threat. It remains 10 times larger than its nearest competitor. That's a strong economic moat if I ever saw one! Look under the bonnet and there's also still a lot to like. Operating margins and returns on capital employed (essentially, what a company gets out from the money it puts in) both remain staggeringly high. They've been that way for years. And this helps to explain why the company has vastly outperformed the FTSE 100 since listing in 2015. This is why taking a long-term approach to holding shares is so Foolish. For complete transparency, I once held a slice of Auto Trader in my Stocks and Shares ISA. I seem to remember making some good money when selling up but experience has since taught me that I was likely snatching at profit. I would probably have done better to stay put. Taking into account this week's sell-off, I'm considering buying back in next month. If we then see a further sell-off, I'm backing up the truck! The post Down 12% in 2 days, is this FTSE 100 growth share now an unmissable buy? appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has recommended Auto Trader Group Plc. 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. Motley Fool UK 2025 Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15-05-2025
- Business
- Yahoo
1 FTSE 100 opportunity I'm eyeing for my Stocks and Shares ISA
I have cash available to invest in my Stocks and Shares ISA at the moment. And while there are some existing investments I could happily add to, I've also got my eye on a new addition. FTSE 100 private equity company 3i (LSE:III) isn't exactly a household name. But it's been on my radar for a little while and with the stock falling today (15 May) this might just be my opportunity. The majority of 3i's private equity portfolio consists of one investment – a 58% stake in a European discount retailer called Action. So in general, a lot comes down to how that business performs. A key metric that I look at with retailers is like-for-like revenue growth. This measures how much sales are increasing adjusting for the effect of opening or closing new stores. According to 3i's latest update, Action has recorded like-for-like sales growth of 6.8% since the start of the year. And I think this is a key reason why the stock is down. By itself, 6.8% revenue growth isn't bad. Investors should note that it comes at a time when other UK retailers such as B&M European Value Retail and JD Sports have been seeing sales going down. Importantly though, Action's like-for-like sales growth in 2024 was over 10%. So the latest results mark a significant slowdown – and that's not the issue. 3i values Action at around 18.5 times EBITDA, which is much higher than either B&M (5) or JD Sports (3). And slowing growth might cause investors to ask themselves whether or not this is justified. 3i has a lot of its eggs in a basket labelled Action, which makes it risky from an investment perspective. If the retailer underperforms going forward, returns could well suffer. Despite this, 3i has been an outstanding investment over the last 10 years. The share price is up over 700% in the last decade, making it one of the FTSE 100's top performers. The secret to the firm's success has been its ability to invest counter-cyclically. In other words, it has done a good job of buying when prices are low, rather than when they're high. For most private equity companies, this is easier said than done. Investors typically show up wanting to deploy capital when they can see good results – but that's when stocks are expensive. 3i's solution to the problem has been to invest its own capital, rather than taking in cash from investors. That allows it to wait for opportunities, rather than having to buy when prices are high. This is a strategy that aligns closely with my own approach to investing. And this makes it a very natural investment to consider for my Stocks and Shares ISA. 3i shares might be up over 700% over the last 10 years, but the stock doesn't look overvalued. It trades at a price-to-book (P/B) multiple below 2 and generates a return on equity of around 25%. I don't think that reflects much in the way of growth expectations. So if the stock stays below £40, I'm looking to make it the next addition to my Stocks and Shares ISA. The post 1 FTSE 100 opportunity I'm eyeing for my Stocks and Shares ISA appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Stephen Wright has no position in any of the shares mentioned. The Motley Fool UK has recommended B&M European Value. 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. Motley Fool UK 2025 Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Rhyl Journal
11-05-2025
- Business
- Rhyl Journal
Halifax warns customers over a little-known £50 rule
Their Ready Made Investment ISA must have a minimum deposit of £500 lump sum or £50 a month. A saver asked: "Do you have any minimum limits (for either a one off payment or regular monthly payments) when opening a stocks and shares ISA?" In response, Halifax explained: "The Stocks and Shares ISA can be invested in at any time with any lump sum amount or any small amounts regularly." They added: "Our Ready Made Investment ISA would have a minimum deposit of £500 lump sum or £50 a month." Customers start with £50 a month or a £500 lump sum, and pick a level of investment risk you're happy with. You can apply and manage things online, using the Halifax app or Online Banking, per BirminghamLive. Ready-Made Investments are looked after by experts, so you don't have to do a thing. Halifax advises: "Decide which level is right for you - cautious, balanced or progressive. You can change this if your circumstances or attitude to risk changes in the future. "Open an Investment ISA or an Investment Account. Everyone wants their money to work harder for them, that's why more of our customers are choosing Ready-Made Investments. Recommended reading: "Our Ready-Made Investments contain investments picked by our experts helping take the worry and confusion away." It says: "Keep in mind, investing in stocks and shares is a longer-term commitment and it is not a substitute for cash savings. "We recommend you leave your money invested for around five years. You should still make sure you have 'rainy day' cash savings to cover unplanned expenses and emergencies. "It's always worth regularly reviewing your goals." You can adjust, track and top up using Online Banking or the app, like everyday banking.
Yahoo
04-05-2025
- Business
- Yahoo
Investing £20,000 in a Stocks and Shares ISA each year for a decade could build a portfolio worth…
The Stocks and Shares ISA is a phenomenal wealth-building tool exclusive for UK investors. And while there's a maximum contribution limit of £20,000 per tax year, that's more than enough to build substantial wealth in the span of a decade. Most Britons don't use their full £20,000 allowance. In fact, the latest figures for the 2023/24 tax year revealed that, on average, only around 25-30% of this allowance was actually used. That's not entirely surprising since the median after-tax salary in the UK is close to £29,000. And putting aside 70% of income towards savings & investments just isn't practical, especially with the cost of living going up and families to take care of. However, for those lucky enough to earn a higher salary or be on the path towards gaining one, maximising the yearly ISA allowance might be possible. So how much money could be unlocked with this wealth-building tool over the next decade? Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions. The gains generated by a Stocks and Shares ISA ultimately depend on the performance of investments made. That means smart investments could turn into some phenomenal gains. Of course, should an investor make bad decisions, it could actually destroy wealth rather than create it. On average, the UK stock market has delivered close to 8% annualised gains over the long term. Across the pond in the US, this figure has been closer to 10%. So assuming a portfolio can generate a return within this range, investing £1,667 a month (to max out the ISA allowance) for 10 years would build a portfolio worth up to £341,500. That's certainly nothing to scoff at, but what if an investor wants to be greedy and aim for more? Instead of trying to replicate the average stock market performance with index funds, investors can buy shares in a handpicked collection of individual businesses. There's no denying this approach is far riskier and requires more dedication. But it also opens the door to potentially superior returns from stocks like RELX (LSE:REL). Over the last decade, this information and analytics specialist has achieved an average annualised gain of 13.9%, enough to push a maxed-out Stocks and Shares ISA close to the £430,000 mark. And with artificial intelligence (AI) demand on the rise, the group appears perfectly positioned to continue capitalising on tailwinds. Does that mean the stock will continue to generate close to 14% each year between now and 2035? Well, nothing's guaranteed. For all its promising and in-demand offer, the group's still prone to operational risks that could disrupt the wealth-building process. For example, missteps in AI deployment across its products could push customers into the arms of competitors. At the same time, the company manages a vast portfolio of sensitive data that makes it an ideal target for cybercriminals. Needless to say, a failure to adequately defend its IT infrastructure isn't likely to bode well for the firm's reputation or its share price. Nevertheless, with an impressive track record and long-term potential, RELX definitely seems like a business worth further inspection for investors seeking market-beating returns in their maxed-out Stocks and Shares ISA. The post Investing £20,000 in a Stocks and Shares ISA each year for a decade could build a portfolio worth… appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Zaven Boyrazian has no position in any of the shares mentioned. The Motley Fool UK has recommended RELX. 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. Motley Fool UK 2025
Yahoo
28-04-2025
- Business
- Yahoo
Here's how to try and turn an ordinary Stocks & Shares ISA into a small fortune
The Stocks and Shares ISA is an incredible vehicle for investing. No capital gains tax, no income tax. It's something that almost every investing Briton will attempt to use. And it's simple to set up. Almost every major brokerage in the UK provides access to an ISA wrapper. I'm led to believe that the average size of a Stocks and Shares ISA in the UK is £8,737. That's probably not a life-changing amount of money for most people. And that's certainly not going to provide enough income for someone to live on. So, how can an investor turn this ordinary ISA into something much larger? Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions. Simple steps To transform an ordinary Stocks and Shares ISA into a much larger pot, the first step is to consistently make use of the annual ISA allowance. For the 2025/26 tax year, this allowance is £20,000, and using as much of it as possible each year can dramatically accelerate the growth of investments. Regular contributions, even if they start small, can add up significantly over time thanks to the power of compounding returns. Another key strategy is to focus on long-term investing. Stocks and Shares ISAs are designed for longer time horizons — typically five years or more — which increases the chances of seeing positive returns compared to cash savings. By staying invested and avoiding the temptation to make withdrawals or react to short-term market volatility, investments have the best chance to grow through both share price appreciation and reinvested dividends. Finally, reinvesting dividends can supercharge an ISA's growth. Many companies pay dividends to shareholders, and by choosing to reinvest these payouts rather than withdrawing them, investors can benefit from compounding. Over time, reinvested dividends can make a substantial difference. This approach, combined with regular contributions and a long-term mindset, can help turn an average ISA into a much larger nest egg. Here's an example of how things can add up. The below assumes £250 of monthly contributions and an average 8% growth rate. Created at Stocks for the job If an investor already has a relatively diversified portfolio, including index trackers, funds, or maybe even just a good variety of stocks, they may wish to consider a stock like Jet2 (LSE:JET2). Why Jet2? Well, I believe it's one of the most undervalued and overlooked stocks on the British market.
