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2 dirt-cheap UK shares I’d buy in February to hold for 10 years!

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I’m searching for the best UK value shares to buy for my portfolio next month. Here are two near the top of my shopping list.

Current pressures

At face value, Netflix’s latest results last week were hugely encouraging. A 7.7m increase in subscriber numbers during the fourth quarter smashed forecasts of around 4.5m.

Yet the streaming giants face an uphill battle in 2023 as the cost-of-living crisis intensifies. This naturally poses dangers to companies that provide streaming services like Zoo Digital Group (LSE:ZOO), too.

At $16.8bn, Netflix spent $863m less on content creation in 2022 that it had the year before. More big reductions are anticipated across the industry as streaming companies protect profit margins.

An AIM starlet

That said, as a long-term investor, I believe the streaming industry remains an attractive place to put my cash. After all, forecasters think the global market will expand at an eye-popping compound annual growth rate (CAGR) of 21.3% between 2022 and 2030.

And I believe Zoo Digital may be the best way to do this. This AIM business allows TV and movie companies to globalise and localise their product.

The problem with investing in streamers like Netflix is that competition is fierce. Disney, Amazon, and Apple are just a few others fighting a bloody war for subscribers. And of course these businesses have to compete against free-to-air broadcasters and cable services providers.

This is why investing in ‘pick-and-shovel’ stock Zoo Digital could be a better idea for me. It provides the tools for streamers to produce their content, insultating it in a fast-growing-yet-highly-competitive market.

Key to big returns?

For the same reason, I believe software development services provider Keywords Studios (LSE:KWS) is a top buy. In fact this is a tech stock I already hold in my Stocks & Shares ISA.

The video games market is also highly cut-throat. But this UK share — which provides technical and creative services to games studios — isn’t hampered by intense competition, either.

Okay, demand for Keywords’ services could also be affected by the cost-of-living crisis. And a shortage of acquisition targets could also derail its long-term growth plan.

But the rate at which its end market is also tipped to grow still makes it an exciting AIM share to me. New console launches and rapid emerging markets growth should supercharge the video games market over the next decade.

Two top UK value shares

I think these two hot growth shares are great buys for patient investors. And I think, at current price levels, they might be too cheap to miss.

Zoo Digital trades on a forward price-to-earnings growth (PEG) ratio of 0.1. Any reading below one indicates that a share is undervalued by the market. And Keywords Studios carries a PEG ratio of 0.3.

With spare cash to invest I’ll be looking to buy both these value stocks for my ISA in February.

The post 2 dirt-cheap UK shares I’d buy in February to hold for 10 years! appeared first on The Motley Fool UK.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Royston Wild has positions in Keywords Studios Plc. The Motley Fool UK has recommended and Apple. 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 2023