The 2020 stock market crash means that many UK shares now trade on low valuations. Although a recovery may seem unlikely at the present time, the track records of indices such as the FTSE 100 and FTSE 250 suggest that it is set to occur over the coming years.
As such, now could be the right time to buy a selection of stocks while they trade at attractive prices. They could deliver higher returns than gold or Bitcoin over the long run.
With that in mind, here are two UK shares that appear to offer margins of safety following their stock price falls in 2020. They could boost your portfolio returns, and help you to make a million.
Rightmove’s (LSE: RMV) recent stock price decline suggests that it could be worth buying in a portfolio of UK shares. The company’s market value has dropped by 13% since the start of the year, as lockdown measures have contributed to a 3.8% decline in its membership numbers. This may mean that the company’s sales come under pressure in the short run.
However, the business reported a relatively sound trading update recently. It noted that visits to its site have been high over recent weeks, while measures taken to improve its financial position could allow it to overcome what may prove to be a challenging period for the housing market.
With a dominant market position and a strong prospect of a long-term recovery in housing transactions, the outlook for the stock appears to be attractive. Certainly, further volatility is likely in the short run, as is the case for many UK shares. However, long-term investors could generate impressive returns from buying the stock today and holding it over the coming years.
GSK: defensive appeal among crashing UK shares
Another FTSE 100 stock that could be worth adding to a portfolio of UK shares is GSK (LSE: GSK). The company’s recent quarterly update showed that it is performing relatively well during what is a challenging period for many businesses. This defensive appeal could make it an attractive proposition at a time when the growth prospects for the world economy are very unpredictable.
As well as its relatively resilient business model, GSK is experiencing strong sales growth. For example, it reported a rise in revenue of 19% in the first quarter, with adjusted profit increasing by 26% over the same time period. With it also announcing developments to its pipeline, as well as plans to reshape its structure, the long-term prospects for the business could improve.
Therefore, after its 7% share price decline since the start of the year, GSK could offer good value for money. It may catalyse a portfolio of UK shares, and increase your chances of making a million over the long run.
The post Forget gold and Bitcoin. I’d buy these 2 crashing UK shares today to make a million appeared first on The Motley Fool UK.
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Peter Stephens owns shares of GlaxoSmithKline. The Motley Fool UK owns shares of and has recommended GlaxoSmithKline. The Motley Fool UK has recommended Rightmove. 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