There’s not much more than a month to go before the 2023-24 ISA deadline. And I reckon the FTSE 250 is a great place to look for buys, now it’s fallen behind the FTSE 100 for the past couple of years.
Here are three I’ve on my Stocks and Shares ISA shortlist.
ITV
The ITV (LSE: ITV) share price has lost more than 50% in the past five years. And I think the stock’s been left seriously undervalued.
For one thing, we’re looking at a forecast 9% dividend yield now. Forecasts show it steady for the next few years too. And that could give me a nice bit of cash each year to buy more shares in my ISA.
In fact, a whole ISA allowance of £20k in a stock that returns a steady 9% a year could grow to a million pounds in just 19 years. I don’t have that much, and I wouldn’t put it all in one stock. But it’s a good motivator.
I think there’s too much gloom over ITV’s ad revenue. And interest rates look like taking longer to come down. So prolonged share price weakness is a clear risk.
But forecasts show earnings growth could drop the price-to-earnings (P/E) ratio as low as 6.6 by 2025.
British Land
I see a lot of cheap Real Estate Investment Trusts (REITs) now, and I’m looking at British Land Company (LSE: BLND) today.
Anything related to property seems like poison right now. But I think this REIT is a great way to make a diversified investment in commerical properties.
Forecasts do suggest the company will make a loss this year. But I expect short-term ups and downs for anything related to property values. And the City expects a bounce back to profit in 2025, with strong growth beyond.
There’s a 6.9% dividend yield on the cards this year though without the earnings to cover it. And there’s a risk that if the trust has to cut the payment, the share price could slump further.
But if forecasts come good, earnings should easily cover the cash from next year onwards.
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abrdn
When the stock market’s weak, investment managers can suffer more than most. And that makes them cheap, right? The abrdn (LSE: ABDN) share price is down 35% in the past five years. And the latest FY results only gave it a short-lived boost.
It looks like we’re in for another year of pretty much the same from abrdn. There’s also uncertainty about the firm’s restructuring. We really won’t know how well it turns out for another few years yet.
In the FY update, CEO Stephen Bird, while speaking of the firm’s strong balance sheet, said: “There is significant work ahead, but we are confident we will be successful in delivering future growth.“
But even without growth, there’s another 9% dividend yield on the cards here. And judging by forecasts, the City seems to think it will be maintained.
Forecast earnings won’t cover the dividends for a couple of years, so there’s risk there. But I’d be comfortable with it.
