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£5k to invest in an ISA? 3 cheap UK shares I think could double in value by 2022

Royston Wild
·3-min read
The UK national flag in front of Canary Wharf skyscrapers where professionals trade shares for a living.
The UK national flag in front of Canary Wharf skyscrapers where professionals trade shares for a living.

It’s obvious to all that the Covid-19 crisis will significantly change the world in a number of ways. A great many UK shares have seen their profits outlooks reduced to tatters as a result. The pandemic has sounded the death knell for plenty of companies with debt-heavy balance sheets as well.

It’s clear that UK share investors need to be extremely careful. But it doesn’t mean you and I should stop investing entirely. Covid-19 has been a disaster for plenty of British stocks, sure. There are still many that should make investors a lot of money in the years ahead. Some even provide goods and services for which demand is likely to explode in a post-pandemic environment.

3 cheap UK shares on my watchlist

Here are several of these UK shares I’m thinking of buying for my own Stocks and Shares ISA today. I think they could even double in value over the next couple of years:

  • Flutter Entertainment isn’t likely to suffer any Covid-19-related hangover. In fact, its share price has leapt 42% so far in 2020 as the number of online gamblers using its services has ballooned. Revenues jumped 22% during the first half of 2020, latest financials showed. Of course, coronavirus-induced lockdowns have boosted activity at the Paddy Power banner. But online gambling activity is still tipped to rise at a stratospheric rate even as the world gradually returns to normal. I reckon a rock-bottom forward price-to-earnings growth (PEG) of 0.7 fails to reflect Flutter’s bright profits picture.

  • It’s clear that Covid-19 will have a significant macroeconomic and geopolitical impact that’ll last for years. Investor nerves are likely to remain on edge while central banks keep monetary policy extremely loose. An indirect way for UK share investors to get rich in this environment is by buying gold-producing stocks. Bullion prices have pulled back from record highs above $2,000 per ounce more recently. But many, myself included, expect them to charge higher again before long. I’m thinking of buying Serabi Gold stock to play this theme. This share — which has rocketed 55% in value in 2020 — provides plenty for value seekers to get stuck into. It trades on a forward P/E ratio of 7 times.

  • The share price gains at logistics specialist Clipper Logistics have been even more impressive. It’s up 75% since the beginning of January as Covid-19 lockdowns have lit a fire under online shopping volumes. And yet this UK share — which I already own in my ISA — still offers brilliant value for money, trading on a PEG ratio of below 1. With e-commerce growing at a blistering pace, it’s too good to miss.

Helping you to get rich!

These UK shares show that stock investors shouldn’t be scared to invest in the current environment. There are still many companies out there that could make you and I a lot of money in the years ahead. And with the help of The Motley Fool and its epic catalogue of exclusive and free investment reports, you can discover even more winners like Clipper Logistics.

The post £5k to invest in an ISA? 3 cheap UK shares I think could double in value by 2022 appeared first on The Motley Fool UK.

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Royston Wild owns shares of Clipper Logistics. The Motley Fool UK owns shares of Flutter Entertainment. The Motley Fool UK has recommended Clipper Logistics. 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 2020