Investing money in the stock market? I think this cheap stock could help you build a £1m portfolio

Home   /   Investing money in the stock market? I think this cheap stock could help you build a £1m portfolio

first_img Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. See all posts by Matthew Dumigan I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. “This Stock Could Be Like Buying Amazon in 1997” Enter Your Email Address Investing money in the stock market? I think this cheap stock could help you build a £1m portfolio Simply click below to discover how you can take advantage of this.center_img Our 6 ‘Best Buys Now’ Shares Matthew Dumigan has no position in any of the shares mentioned. The Motley Fool UK has recommended Compass Group. 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. Image source: Getty Images. I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. .In my view, one of the best ways to build serious wealth over time is investing money in high-quality businesses and holding the shares for the long term. What’s more, in the aftermath of a stock market crash, such companies can often be found trading on vastly reduced valuations. As a result, investors who capitalise on these buying opportunities can expect favourable returns further down the line.With that in mind, here’s a cheap UK stock that I think could boost your prospects of building a six-figure investment portfolio, if held for the long term.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Investing money in first-class contract cateringCompass Group (LSE: CPG) is a multinational contract catering company headquartered in the UK. As the largest contract foodservice group in the world, Compass has operations in 45 different countries, employing over 600,000 people.After reaching an all-time high in September, the group’s share price has since plunged 46%. That’s mostly thanks to the combination of Covid-19 and the subsequent stock market crash.The company’s share price demise is hardly a mystery. As chief executive Dominic Blakemore stated in May, the coronavirus pandemic has “changed everything” for the foodservice group.An uncertain future outlookGroup organic revenue fell 44% in the third quarter of 2020, reflecting the period over which lockdown measures were most severe in the markets in which Compass operates. Evidently, this will take its toll on the group’s finances and recovering from the damage caused by the lockdown won’t be straightforward.However, Blakemore is confident that the business is “well-placed to succeed in a post-Covid-19 world”. I’m inclined to agree with him. By the end of June, around 60% of the business was open again. Additionally, the group has reported a positive performance in the healthcare, defence and remote divisions of the businesses.Provided the economy can continue to recover over the coming months and years, Compass should be able to kickstart operations in other business areas. This should in turn fuel share price appreciation and make sit a worthy focus when you’re investing money for your future.A dirt-cheap UK stockSpeaking of share price appreciation, Compass Group shares will have to bag a near 70% return in order to recover their pre-crash valuation. But over the long term, I think it’s entirely feasible for those investing money today to expect attractive returns.With that in mind, a P/E ratio of 13.5 seems more than justified. Especially when considering the company’s healthy balance sheet and the overall strength of the underlying business.Building a £1m investment portfolioUltimately, I think shares in Compass Group could go a long way in helping you build serious wealth. Owning some as part of a diversified investment portfolio could even boost your prospects of making a million. That may sound ridiculous to you, but let me explain.Let’s say you’re thinking about investing money monthly into a mixture of UK shares. £500 sounds like an affordable figure. Assuming an annual return of 8% (identical to the average return of the FTSE 100 index) you’d have an investment pot worth £1,078,202 after 35 years. This illustrates the power of a combination of time and compounding returns. Matthew Dumigan | Saturday, 22nd August, 2020 | More on: CPG last_img

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