I think these investment trusts could be brilliant buys before next month’s Stocks and Shares ISA deadline. Here’s why.
Euro star
I don’t need to actually buy shares to make use of my £20,000 annual ISA allowance. I simply need to add money to my account by 5 April to ensure I don’t lose any remaining allowance.
But I don’t see any point in delaying. The London Stock Exchange is packed with bargain trusts that I’d like to buy before they have a chance to recover in price.
Tritax Eurobox (LSE:EBOX) is one such stock on my radar today. With a share price of 52p per share, it trades at a significant discount to the value of its assets. The company’s net asset value (NAV) currently sits at around 84.8p.
To add to its investment case, the FTSE 250 company’s forward dividend yield comes in at a whopping 8.2%.
Tritax Eurobox shares could remain under pressure if interest rates fail to recede sharply, keeping the pressure on its NAVs. But the direction of travel looks highly encouraging as inflation in the eurozone steadily falls.
Regardless, I’ll be happy to accept a little short-term trouble considering the company’s bright long-term outlook. The company owns and lets out warehouse and distribution hubs across Mainland Europe, demand for which should continue to grow thanks to the e-commerce boom and supply chain evolution.
In fact, I think rental growth could continue to accelerate as a dearth of new development projects drags on. Tritax’s like-for-like rents rose 4.5% in the 12 months to September, up from 3.6% in the prior year.
Check it out
I think real estate investment trust (REIT) Supermarket Income REIT (LSE:SUPR) also offers terrific value today.
At 77p per share, the business trades at a discount of around 16% to its estimated NAV per share of 89.9p. On top of this, its forward dividend yield stands at a market-busting 7.9%.
Indeed, REITs like this can be especially effective ways to make long-term passive income. This is because they are obligated to pay at least 90% of annual rental profits out in the form of dividends.
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But why this particular REIT, you ask? Well, I love its defensive qualities that allow it to pay big dividends year after year. As the name implies, it focuses on the food retail sector, where profits remain broadly stable regardless of economic conditions.
On top of this, Supermarket Income lets out its properties to the ‘Big Four’ supermarkets (like Tesco) alongside other big players like Aldi and M&S. I think it’s highly unlikely that large institutions like this will fail to pay their rent..!
Pleasingly, the grocery sector is poised for long-term growth that the company can exploit. As the population steadily increases, so will demand for new shopping outlets.
Competition for land is high, and this may impact the trust’s ability to grow profits. But on balance I still expect it to deliver excellent returns in the coming years.
The post 2 of my top investment trusts for Stocks and Shares ISA investors to consider appeared first on The Motley Fool UK.
Pound coins for sale — 31 pence?
This seems ridiculous, but we almost never see shares looking this cheap. Yet this Share Advisor pick has a price/book ratio of 0.31. In plain English, this means that investors effectively get in on a business that holds £1 of assets for every 31p they invest!
Of course, this is the stock market where money is always at risk — these valuations can change and there are no guarantees. But some risks are a LOT more interesting than others, and at The Motley Fool we believe this company is amongst them.
What’s more, it currently boasts a stellar dividend yield of around 10%, and right now it’s possible for investors to jump aboard at near-historic lows. Want to get the name for yourself?
See the full investment case
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2 REITs to help me build an additional income stream
Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Tesco Plc. 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.
