From my observations, it seems millennial investors are ready to take a little more risk than investors approaching retirement age. Which is how it should be. With time on your side, a long-term portfolio can be grown at a steady pace and there is more leeway for mistakes to be made. So, if you are a millennial investor with plenty of investing time ahead, you may like to consider the following three stocks for your Stocks and Shares ISA. I like easyJet (LSE:EZJ), Aston Martin Lagonda (LSE:AML) and Plus500.
My top airline stock: easyJet
After falling 54% this year, the easyJet share price looks to be in budget territory. Clearly, with talk of the global pandemic being far from over, there’s risk associated with buying airline stocks. However, I do think they will eventually recover, and global flights will resume. When it does, easyJet looks well placed to continue where it left off and should rise to the occasion.
EasyJet has a price-to-earnings ratio of 7, earnings per share are 88p and it has access to enough cash to cover a nine-month grounding (if such a dismal scenario arises).
Given time, I think this airline will recover, but its share price may have further to fall before it does. I think it’s one stock for millennial investors to watch, waiting for a dip and buying with patience in mind.
My top car stock: Aston Martin Lagonda
The Aston Martin share price has been yo-yoing all over the place these past few weeks. From a high of 80p in early June it’s now back down 37.5% to hover around 50p. Hitting the headlines on close to a daily basis, Aston Martin has many reasons for its share price volatility. In late April, the company resorted to a £500m rights issue, its CEO confirmed his exit at the end of May, followed by the news it would axe 500 jobs. Last week it then confirmed another share placing, to raise a further £152m to get it through the coronavirus crisis.
Despite all the challenges it’s facing, the company has big plans to produce luxury electric cars, including a £1.5m+ hypercar for launch next year. I think this is an interesting speculative stock for millennial investors to buy. It could offer significant upside in the years to come, but remains risky given its volatile history since listing.
My top investing/personal finance stock: Plus500
The Plus500 share price has been enjoying a winning streak since the pandemic struck. It’s up over 50% year-to-date. The cancellation of sporting activities brought a lot of would-be gamblers into the stocks and shares arena. This resulted in many new customers opening accounts with Plus500 to begin their journey into trading equities, cryptocurrencies and a myriad of other financial offerings.
Plus500 has low debt, a price-to-earnings ratio below 12, earnings per share are £1.09 and it pays a dividend yield of nearly 4%. It may prove to be a cyclical buy, faring better when markets are volatile, but over the long term, I think it looks a top stock to buy for further growth and income.
I think this is a good selection of diversified stocks to add to millennial investors’ portfolios. Risky, yes. But diversifying your shares with companies from a selection of sectors helps to offset that risk.
The post Millennial investors: 3 stocks I think they should be buying appeared first on The Motley Fool UK.
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Kirsteen has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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