I decided to take a closer look.

B&M European Value Retail

B&M European Value Retail (LSE: BME) is a popular discount retailer that’s been nose-diving in 2025. The shares are now down a stomach-churning 55% since the year began.

I like a good discount as much as the next person but that kind of price cut raises questions, not excitement. Another thing it raises is the dividend yield, now up to 9.2%. In fact, for long-term shareholders, the total yield for this year would be up to 18% when adding the special dividend.

But falling profits forced the company to cut the special dividend from 20p to 15p this year. Overall, it still equates to a juicy return — but there’s a risk more cuts could occur if earnings don’t improve.

Promisingly, dividend payments are still well-covered by cash and earnings — and backed by 11 years of uninterrupted payments. That suggests they’re both reliable and sustainable for at least the next year or so.

There are other more pressing concerns though. B&M slashed its 2026 full-year EBTIDA forecast last month, to £470m from £520m. At the same time, CFO Mike Schmidt announced his departure following a board-commissioned third-party review of finances.

If the review unearths more serious complications, the stock price could crash even further.

In spite of these troubles, brokers appear confident in a recovery. Deutsche Bank, in particular, has opened several positions over the past few months — despite some down as much as 30%.

For my part, I’ll wait for the results of the financial review before considering the stock. But this next one looks more promising to me.

SThree

SThree (LSE: STEM) is a London-based specialist staffing firm operating brands such as Computer Futures and Huxley.

The company was doing well post-Covid, but rising unemployment has sent its profits tumbling. The shares now trade near a 15-year low, following a 12% decline in net fees in Q3 2025.

It aims to turn things around through cost optimisation and a focus on AI, but results may be slow.

In the meantime, its dividend yield’s surged past 9%, making it attractive to income investors. And unlike many struggling businesses, dividends are well-covered by both cash (1.8 times) and earnings (1.3 times).

It also boasts a 19-year-long track record of payments, giving it an added layer of trust.

That said, the company did make minor dividend reductions in 2024 and again his year. Presumably, if things don’t improve, there’s a risk of further cuts.

Stubborn inflation combined with AI-driven disruption continues to strangle the UK job market. It’s too early to say when things will improve, but if it drags on for too long, dividend yields will be the least of our worries.

Aggressive government tactics might help reduce interest rates in 2026, which should help. If so, SThree should see a decent recovery, making the current price an attractive entry point for value investors.

It’s a risky play but one that could deliver both growth and income in the long term. For those with the appetite, I think the odds of a recovery make it worth considering.

The post 9%+ yields! These high-payout income shares look too good to be true appeared first on The Twelfth Magpie.

SThree

The steady adoption of artificial intelligence (AI) is providing significant challenges for the recruitment sector. According to job search platform Adzuna, the number of new entry-level roles in the UK has slumped 32% since November 2022. That coincides with the launch of the first mass-used chatbot ChatGPT.

As generative AI systems get smarter, the switching out of human roles for machines looks set to accelerate. Yet I still believe some recruitments stocks — one of which is SThree (LSE:STEM) — still demands serious consideration.

This company’s focused on STEM roles (those in the science, technology, engineering and mathematics sectors). The emergence of AI means job roles here are evolving rather than disappearing, meaning there’s still room for significant growth thanks to phenomena like the booming digital economy, rising defence expenditure and soaring healthcare demand.

SThree has seen profits slide recently as higher interest rates have sapped company hiring. City analysts are tipping another earnings drop (62%) in the 12 months to November too.

However, its bottom line’s expected to recover strongly beyond then, with rises of 22% and 28% pencilled in for fiscals 2026 and 2027 respectively. Current projections reflect expectations of recovering markets, and the company’s restructuring efforts in the US and UK.

These projections leave SThree’s shares looking attractive from a value perspective too. At 244p per share, its price-to-earnings growth (PEG) ratios for these years are 0.6 and 0.4, well below the bargain threshold of 1.

While it’s not without risk, I think they’re worth serious consideration at current prices. It also offers a healthy 5.8% dividend yield on predicted shareholder payouts through to fiscal 2027.

Baillie Gifford European Growth Trust

The Baillie Gifford European Growth Trust (LSE:BGEU) has risen sharply in value in recent months. This reflects a broad improvement in market sentiment and, more specifically, rising demand for European shares as investors switch out of the US.

Yet this small-cap trust still offers tasty value for money at 101.5p. It trades at a 9% discount to its estimated net asset value (NAV) per share, meriting close attention, in my book.

The fund aims to grow through a portfolio of 30-60 companies from across Mainland Europe (current count: 45). These range from Dutch software provider Topicus.com to Irish airline Ryanair, and Swiss pharmaceuticals giant Novo Nordisk. This helps protect overall returns from weakness in one or two countries and/or industries.

Another reason I like this Baillie Gifford product is it also invests in private companies I wouldn’t be able to buy on an exchange. One example is Bending Spoons, an Italian mobile app developer whose annual revenues rose around a quarter in 2024.

On the downside, the European growth trust could deliver poor returns if the eurozone economy struggles. But I’m optimistic returns will pick up as interest rates fall and broader appetite for continental shares improves.

The post 2 dirt cheap small-caps to consider in July appeared first on The Twelfth Magpie.

When investing in dividend shares, early investors often fall foul of some common mistakes.

Here are two to keep in mind.

Not all companies are created equal

There’s no shortcut when picking dividend stocks and no single model that applies to all companies. When considering investing for dividends, the individual strengths and weaknesses of reach company must be accounted for.

This is particularly true when it comes to dividend coverage. This metric is used to assess how much cash the company has to cover its dividend obligations. Presumably, if its cash is less than the full amount of dividends, there’s going to be a problem.

Companies that need steady cash flow to operate typically pay a low dividend and as such, have high coverage. However, some companies don’t need much cash to operate and so pay a high dividend with low coverage. This reveals how low coverage isn’t necessarily a bad thing.

It’s important to find out how the company operates before making a decision based solely on coverage. Even a company with high coverage may cut the dividend if it has a lot of debt to finance.

These factors differ from company to company, so each one needs to be assessed on an individual basis.

Investing for the yield

Investing purely for the yield isn’t a good long-term strategy. Yields fluctuate wildly and are often high for the wrong reasons, such as a crashing price. 

Some investors buy stocks just before the ex-dividend date as a way to lock in a yield at a certain level. This can be a smart strategy but doesn’t guarantee anything. Ignoring the company’s fundamentals and potential price movements is risky. If the stock falls more than the yield before payment, then it’s all for nothing. 

Before making a decision based on the yield, investors should always carefully assess the company’s financial position.

Examples to consider

In 2023, Vodafone had one of the highest yields on the FTSE 100, at 10.8%. But falling earnings forced it to slash the dividend in half, bringing the new yield closer to 5%. Investors who bought for the yield and didn’t foresee the problems would have been disappointed.

Fellow telecoms giant BT Group currently has a yield of 5.7% and sufficient cash to cover dividends. However, it’s drowning in £18.9bn of debt, ramping up the possibility of a dividend cut in the near future.

The specialist staffing company SThree (LSE: STEM) looks more promising and may be worth considering. It has a 5.8% yield that’s well-covered by cash flows. Additionally, its cash has almost doubled since 2021 while its debt has decreased. Annual dividends have also increased from 11p to 16.9p per share.

But a challenging job market led to a profit warning last month that spooked investors. An expected 61% decline in pre-tax profit caused the stock to crash. Now with a price-to-earnings (P/E) ratio of only 6, it looks attractive. But if the market doesn’t recover, it could still fall further.

Still, I like its long-term prospects. Revenue has been climbing for several years and analysts forecast on average a 30% price increase in the next 12 months.

The post Avoid these 2 mistakes that investors make with dividend stocks appeared first on The Twelfth Magpie.

Recruitment in focus

I’m talking about SThree (LSE:STEM). The share price for the stock’s down 33% over the past year. Let’s first run through what the business does and how it makes money.

SThree is a multinational recruitment company that specialises in headhunting for STEM (science, technology, engineering and mathematics) industries. By placing candidates at companies, it generates placement fees.

The recruitment model has been proven over many decades. I don’t dispute that. But for SThree, a recent profit warning flagged several reasons why now might not be the best time to invest.

Worrying factors

The specific trading update mentioned that group net fees for the full year would be down 9% versus last year “against the backdrop of ongoing challenging market conditions”.

Another factor for poor performance was the “increased political and macro-economic uncertainty”, which SThree said slowed down decision making when it came to new hires.

Finally, there were further concerns as the “labour market is undergoing changes driven by new technology and new ways of working“.

Unfortunately, I think all of these factors are going to persist into 2025. For example, the increase in political uncertainty. Germany and France will likely have new elections next year. The US inauguration will happen in late January. There’s plenty of scope for issues relating to politics spilling over for SThree.

When it talks about changes to the labour market with new technology, part of this is likely referring to some human jobs being cut due to artificial intelligence (AI) use instead. If this trend continues (I think it will) then SThree will generate lower revenue due to less hires needed.

A cheap consideration

It doesn’t surprise me that the share price dropped substantially based on this recent update. Yet even with that reduction, I still think it has further to fall next year.

Some will disagree with me. The fall in the stock has meant the price-to-earnings ratio’s now just 6.63. This could indicate that it’s undervalued in comparison to my fair value benchmark of 10. Further, SThree has a good spread of placement fees around the different sectors. So even if technology suffers, the other areas could help to offset this slack.

Even with these points, I’m still concerned that the reasons being flagged as a cause for concern right now are only just beginning. With the rise of AI, heightened political issues and general challenging conditions for recruitment, 2025 could make things a whole lot worse.

On that basis, I’m staying well away and feel it could be a really poor performer over this period.

The post I think this could be the worst-performing FTSE 250 stock in 2025 appeared first on The Twelfth Magpie.

[Just beginning your investing journey? Check out our guide on how to start investing in the UK.]

Babcock International

What it does: Babcock designs and manufactures specialist defence and engineering equipment to support national defence.

By Mark Hartley. With a £2.2bn market cap, Babock (LSE:BAB) is a comparatively small FTSE 250 company that supports defence initiatives in the UK and abroad. Early last year, reports emerged alleging that Babock had used glue to fix bolt heads on a nuclear submarine. Controversy ensued and the company quickly addressed the situation, but it still suffered considerable losses in the following months.

However, a swift recovery occurred soon after. As global demand for defence equipment escalated in late 2023, so did Babcock’s share price. Now up 47% over the past year, it’s finally broken back above the key 400p level it lost during Covid. The growth has prompted UK-based stock broker Numis to bump Babcock from a hold to buy, increasing their price target from 325p to 530p this month.

With a recently reinstated dividend and a new deal to develop Australia’s nuclear submarine program, I think Babock is back in business.

Mark Hartley does not own shares in Babcock International.

Burberry

What it does: Burberry is a British luxury brand with outlets across Asia, the United States and Europe.

By Andrew Mackie. Over the past 12 months, the Burberry (LSE: BRBY) share price has fallen nearly 50%, making it one of the worst performers in the FTSE 100. A slowdown in sales growth across the luxury sector has resulted in it issuing two profit warnings in as many months.

To my mind, the market is presenting me with an absolute gift at the moment. The overall luxury market might be depressed at the moment, but I doubt very much that will remain in the doldrums for too long.

The company is in the early stages of a new strategy, one which places its heritage and Britishness at its core. The hiring of a Daniel Lee, as its chief creative officer, is a bold move. But it’s too early to tell if his designs are having the same impact as they did at Bottega Veneta.

Burberry undoubtedly faces some significant headwinds. Demand across the US has fallen, particularly for its lower-priced products. Exchange rate movements have also hurt both revenue and profits.

The mantra of any investor is to buy low and sell high. With so much bad news already factored into its share price, for me it’s a screaming buy. That is why I added some to my portfolio in the last week.

Andrew Mackie owns shares in Burberry.

iShares Oil & Gas Exploration & Production ETF

What it does: Exchange-traded fund aggregating leading global companies in oil and gas exploration and production.

By Mark Tovey. I recently bought shares in iShares Oil & Gas Exploration & Production ETF (LSE:SPOG), an oil and gas ETF. This fund got beaten up last year. That’s despite analysts, like Jeff Currie, a renowned commodities expert, having been bullish on the sector.

So, why didn’t things go as planned for oil speculators in 2023? Well, soaring energy prices and pressure on Western politicians led to a lax approach towards sanctions on hostile countries like Venezuela, Iran, and Russia, and a sidelining of stringent environmental policies for a more “drill baby drill” approach.

However, according to Currie, with inflation falling back to targets, those factors from 2023 are unlikely to repeat. Instead, politicians are likely to pivot back to green policies and cut links with hostile regimes. At the same time, historic underinvestment in oil and gas means continuing supply constraints.

One risk of buying SPOG shares is that oil and gas prices depend on global economic growth, and a worldwide recession would hit the industry hard.

Mark Tovey owns shares in iShares Oil & Gas Exploration & Production ETF.

J.D. Wetherspoon

What it does: J.D. Wetherspoon owns and operates a chain of UK pubs known for their cheap prices to customers.

By Stephen Wright. Right now, J.D. Wetherspoon (LSE:JDW) is my best British stock for February. I’ve been buying shares in the company in January and I’m looking to continue doing so this month.

Higher inflation in November isn’t good for the company and is an ongoing risk with the stock. Even if it’s mostly tobacco, anything that makes the cost of living more expensive is bad news.

Despite this, Wetherspoon just announced some decent trading results. Over the last six months, sales were up 10%, meaning 8% sales growth over the last year.

This indicates that the business is resilient. And I’m expecting it to remain that way for some time, which is why I’ve been buying the stock.

To be honest, I wish I’d bought it when I first had the idea – when the share price was around £5.50. But at £8.30, and with the business showing strength, I think there’s still value here.

Stephen Wright owns shares in J.D. Wetherspoon.

SThree

What it does: SThree is a recruitment business specialising in STEM sectors – science, technology, engineering and mathematics.

By Roland Head. Recruiter SThree (LSE: STEM) reported a drop in activity last year, reflecting a wider market slowdown. Its share price is down by a third from the highs seen in 2021, but I think this is likely to be a buying opportunity.

I reckon SThree’s STEM focus should mean that demand bounces back quickly, supported by long-term growth trends. As far as I can see, the world is not likely to stop needing more well-qualified scientists, programmers, engineers, and mathematicians.

Of course, there’s a risk that demand will weaken further before it starts to improve. I can’t be sure.

However, SThree’s share price slump has left the stock trading on just 10 times earnings. There’s also net cash on the balance sheet, and a well-supported 4% dividend yield.

Earnings are expected to be flat this year before a gradual recovery. I think this could be a good time to buy.

Roland Head does not own shares in SThree.

The post Best British shares to consider buying in February appeared first on The Twelfth Magpie.

All of the UK shares worthy of inclusion in a portfolio should exhibit the potential for driving decent investor returns over time. And I think I’ve found one worth consideration now.

Staffing and recruitment specialist SThree (LSE: STEM) is trading well. And January’s full-year results report headlined with: “Record profit performance up 24% driven by continued demand”.

Materially ahead of expectations

The company describes itself as a global specialist talent partner focused on roles in Science, Technology, Engineering and Mathematics (STEM). And for the trading year to 30 November 2022, the business delivered a net fee performance “materially ahead” of the directors’ prior expectations. And it came in 19% higher year on year.

The outlook statement was bullish. And I think the outperformance combines with those positive expectations to make SThree worthy of further research.  

Meanwhile, with the share price near 443p, the forward-looking earnings multiple is just above 10 for the trading year to November 2024. And the anticipated dividend yield is about 3.8%. That valuation isn’t outrageously high. And the balance sheet looks strong.

However, there’s no denying the vulnerability of the business to general economic cycles. And that shows up in a patchy multi-year record for earnings, cash flow and shareholder dividends. 

On top of that, the share price has been generally moving sideways rather than higher over the past decade and a half. However, past performance is not a reliable guide to the future. And it’s possible that the business could enter a sustainable period of growth. Indeed, the stock may break above its prior trading range, although such outcomes are never certain.

Growth is happening

However, as well as having cyclical characteristics, it looks like the enterprise is growing. And a multi-year holding period may help investors capture some of the potential upside from business expansion.

I see the revenue record as encouraging. In 2017, the company achieved a turnover of £1,115m. But City analysts predict revenue will grow to around £1,588m in the trading year to November 2024. And that leads to the compound annual growth rate for revenue running at about 8%.

In January, chief executive Timo Lehne said the company has “a clear strategic vision and an execution plan”. And it’s centred on an analytical and fact-based approach. Meanwhile, SThree has a “healthy” contract orderbook. And general macroeconomic and geopolitical conditions have been improving since the end of last year.  

Lehne reckons the firm’s global reach combines with its specialist niche focus in structural STEM disciplines to underpin a proven “resilient” business model. And the business is in a strong position to pursue its “unique” opportunity over the medium to long term.

So, despite the risks, I think the business and the stock look attractive now with a long-term holding period in mind. It could, for example, sit well in a diversified portfolio of positions aiming for dividend income and capital growth.

Investors with spare cash may like to dig in to the opportunity now with their own deeper research and form their own opinion.

The post 1 of the top UK shares with compelling reasons to buy  appeared first on The Twelfth Magpie.

Today I’m looking at three companies with updates in September, all of which I think offer attractive progressive income.

Specialist recruitment

My first pick is SThree (LSE: STEM), due to bring us a third-quarter trading update on 20 September. The recruitment company, which specialises in the IT sector, saw its share price collapse again after a sharp spike in 2021.

Figures for the first half looked impressive, with net fees up 25% and operating profit up 62%.

There was net cash on the books, and SThree lifted its interim dividend by 67% to 5p per share. Forecasts suggest a 4% yield for the full year, and a price-to-earnings ratio of below 10.

That dividend payment appears cautious to me, with cover likely to be strong.

There is cyclical risk here, though. In the two pandemic years, the dividend was drastically cut. And there’s a recession on the horizon. But on balance, I see desirable long-term income.

Dividend recovery

My next choice is one that’s on something of a tentative recovery. I’m looking at construction firm Galliford Try (LSE: GFRD).

The company suffered two years of tough losses during the pandemic, and suspended its dividend in 2020. In 2021, it came back at a much lower level. The 4.7p dividend that year was but a shadow of the 77p paid in 2018. It yielded 3.3% on the share price at the time.

Forecasts show the dividends growing slowly but steadily. They predict a yield of 4.5% this year, growing to nearly 6% by 2024. Again, they should be well covered.

Like all broker forecasts, these are to be treated with caution. And at this stage in its recovery, Galliford Try is still a risk.

But the company’s July trading update spoke of “strong performance across operations resulting in increased revenue, pre-exceptional profit and operating margin.” Full-year results are due on 21 September.

Soft drinks

My final selection is AG Barr (LSE: BAG), which I think might hold up well in a recession. The soft drinks producer will deliver first-half figures on 27 September.

Barr did suspend its dividend during the pandemic, even though it still recorded healthy profits. But it’s a company that likes to trade with net cash, and I find that refreshing these days.

August’s trading update revealed a 19% increase in like-for-like revenue.

Inflation could hit trading, though. And the company pointed out that it’s suffering rising costs just like everyone else. It’s in a very competitive business too, so that’s something to watch out for. Part of Barr’s business comes from the hospitality sector. So there may be pressure there through the looming recession.

The dividend is modest, with forecast yields of around 3%. But I think we could be looking at a long-term defensive income investment here.

The post 3 unmissable income shares to buy in September? appeared first on The Twelfth Magpie.

So far however, these businesses are still thriving. A chronic jobs shortage means net fees are soaring, as blockbuster results today from Robert Walters show.

Net fees at the firm soared 26% year-on-year between April and June. Fees were also the highest second-quarter number on record and prompted Robert Walters to lift its full-year profits forecast.

SThree’s no stranger to lifting its own earnings estimates either. In mid-June, it raised forecasts after announcing a 25% jump in net fees in the first half, to £203.1m. Critically, the small-cap said it witnessed “very strong” growth in its German, US and Dutch markets too.

A top stock for the tech age

I like SThree in particular because of its focus on the STEM (Science, Technology, Engineering and Mathematics) sectors. These are poised for strong growth over the long term as areas like healthcare, renewable energy, automation and the Internet of Things continue to evolve.

In the meantime, City analysts are confident the company should continue growing earnings despite rising economic headwinds. Increases of 9% and 8% are forecast for the financial years to November 2022 and 2023 respectively.

At current prices, these forecasts leave SThree trading on a forward price-to-earnings (P/E) ratio of around 10 times. Such a low valuation comes despite the firm’s impressive resilience so far. I’d use recent share price weakness as a buying opportunity.

5.6% dividend yields

Urban Logistics REIT (LSE: SHED) is another dirt-cheap UK share on my radar. I like this particular stock because it offers terrific value from both a growth and earnings perspective.

The property stock trades on a forward price-to-earnings growth (PEG) ratio of 0.8. A reminder that any reading below 1 suggests that a stock is undervalued.

Meanwhile, Urban Logistics carries meaty dividend yields of 5% and 5.6% for the next two financial years.

A red-hot property share

Urban Logistics invests in big-box warehouse and logistics assets which are critical in an age where e-commerce is growing sharply. In fact, supply of these properties in Britain remains low while demand is ripping higher, driving rental income at firms in this area to the stars.

Helped in part by recent acquisitions, rental income at Urban Logistics soared 59.8%, to £36.5m, in the 12 months to March. Latest financials also showed the value of its properties grow 25.4% on a like-for-like basis to £153m.

An acquisition-led growth strategy can leave a company open to risks like unexpected costs. But I’m encouraged by the excellent track record Urban Logistics has on this front.

City analysts think earnings here will rise 25% in this financial year to March 2023 and 9% next year too. And I expect the business to deliver strong and sustained profits growth over the long term too.

The post 2 dirt-cheap UK shares to buy right now! appeared first on The Twelfth Magpie.

Barnstorming results

And to answer my own question, buying the stock now looks like a good idea for me. After all, as we might expect today’s figures are good. For the 12 months to 30 November, revenue at constant currency rates increased by 14% compared to the year before. And of that, fee income rose by 19%.

That turnover caused earnings per share to shoot up by 143%. And the company managed to increase its net cash position by 15% to £57.5m. The outcome clearly pleased the directors and they rewarded shareholders with a 120% lift in the total dividend for the year.

I reckon much of the good performance comes down to the success of the company’s strategy. Sthree describes itself as “the only global pureplay specialist staffing business focused on roles in Science, Technology, Engineering and Mathematics (STEM)”.

Interim chief executive Timo Lehne said in today’s commentary, the “record-breaking” results demonstrate the company has a “robust” strategy focusing on STEM and flexible working. He said the market rebounded in 2021 after the challenges caused by Covid-19, and demand for STEM rose.

Sthree capitalises on demand for STEM skills by placing engineers, developers, scientists and other professional people into industry where they’re needed.  And Lehne reckons there’s been “particular” client demand for the company’s employed contractor model. And Sthree leads that market segment in many countries. The category accounted for around 32% of overall net fees.

A robust outlook

Looking ahead, Lehne sees strong momentum in the business driven by robust demand for the talent the company provides. And he expects “double-digit” growth in 2022. Meanwhile, the valuation looks undemanding, despite the buoyancy of the stock today.

With the share price near 465p, the earnings multiple based on today’s results works out at just below 15 and the dividend yield is around 2.4%. However, if the business achieves the growth in earnings it hopes in 2022, the forward-looking valuation numbers could reduce. But such positive expectations becoming  a reality is never certain and it’s possible for operational challenges to arise that could derail the forecasts.

And another factor I’m wary about is the high degree of cyclicality in the firm’s business model. If demand cycles down, it’s likely that so will profits, dividends and the share price.

Nevertheless, I’m bullish about the prospects for world economies and the labour market for all timeframes right now. And the strength of Sthree’s balance sheet also encourages me. So I’m tempted to buy some of the shares now to hold with a timeframe of at least five years in mind.

The post Should I grab shares in this small-cap company, up more than 10% today? appeared first on The Twelfth Magpie.

Recruitment drive

SThree is an international firm providing permanent and contract specialist staffing services for information and communication technology, banking and finance, energy, engineering, and the life science sectors. The ticker STEM derives from its focus on science, technology, engineering, and mathematics.

One of the primary reasons I class SThree as one of my best shares to buy now is diversification. In my opinion it possesses this on two fronts. Firstly, it operates in a diverse range of industries and is able to place staff in a lot of different sectors, some of which are booming. A prime example is technology. Approximately half of its business comes from tech. Life sciences and engineering follow closely with banking and finance accounting for less than 10% of its business.

In addition to the sectors in which SThree operates, it is diverse in its locations. In recent years it has made massive investments to bolster its global footprint.

Share price and performance

As I write, I can buy shares in SThree for 498p per share. Rewind to this time last year and shares were trading for approximately 100% less at 247p per share. This is a healthy share price rise which reflects the company’s recovery since the pandemic slowed its progress. In fact, SThree’s share price has surpassed pre-crash highs of 386p per share too.

Another reason I rate SThree as one of my best shares to buy now is its consistent performance. Last month, on 19 July, it released its half-year trading report which made for excellent reading in my opinion.

SThree pointed towards better market conditions and a rise in demand for STEM skills. Results confirmed an increase on all fronts compared to the same period last year. The highlights for me were an increase in operating profit increasing by 101% and profit before tax increasing by 110%. In addition to this, it increased net cash by 53% compared to the same period last year. Finally, SThree confirmed that FY21 results would be ahead of expectations based on such a fruitful first half year.

SThree also has an excellent historic track record of increasing revenue and profit before the pandemic affected this year-on-year upward trend. As a savvy investor, I fully understand that past performance is not a guarantee of the future but I prefer companies with a good track record.

Even the best shares to buy now have risks

My first issue with SThree is that it is trading at all-time highs. This means that any bad news or negative market reaction could cause a sharp share price drop. Second, SThree was badly affected by the pandemic. If there were to be further restrictions based on the rising number of Covid-19 cases, there could be a repeat of this.

Overall I would by SThree shares for my portfolio at current levels. I do believe it can continue to grow. SThree’s track record and growth to date convince me it could be a good addition to my portfolio despite the risks involved. It is high on my best shares to buy now list.

The post Here is one 1 of my best shares to buy now appeared first on The Twelfth Magpie.