5 of The Best Cheap UK Stocks to Buy in September

These cheap British companies are discounted and ripe for the picking.

Last Updated August 30th 2021
7 Min Read

Buying highly undervalued stocks is one of the best ways to profit consistently in the equity markets. Each month brings with it, its own set of value stocks.

For September, here are some of the most undervalued UK stocks with the potential to outperform the market.

5 of The Best Cheap UK Stocks to Buy in September

We think the following UK shares are some of the best value stocks to buy in September.

Carnival Group

The luxury travel rebound winner

Carnival offers plenty of all-round value to UK share investors. The stock is currently undervalued, primarily due to the improving situation regarding COVID-19.

With the high vaccination rates in the UK and most of the developed world, leisure travel is likely to bounce back going forward.

This puts Carnival and other leisure and travel companies in pole position to experience a resurgence in growth.

The company is also well-positioned to weather any changes in monetary policy in the short term.

There is speculation that the Bank of England could raise interest rates as early as 2022.

While this could hurt stocks, Carnival Group PLC’s books paint a picture of a company that can easily navigate through such interest rates hikes.

The company has a quick ratio of 1.0840, which means it has the assets to cover short-term liabilities regardless of the circumstances.

Besides, the worst of the pandemic is overdue to the increased vaccination rates. This means that even an interest rates hike is unlikely to harm the company in the near term.

Other than the rebound in the economy, this stock is attractive because it is a dividend payer.

This FTSE 250 stock has a pretty high dividend yield, standing at 8.53%. This makes the stock quite a valuable hold in the short term.

The technicals also point to a stock that is trading at massive lows. Before the pandemic in March 2020, the stock was trading at over GBP 4000.

It has since plummeted and is currently trading at around GBP 1400. Given that the conditions that led to its drop are mostly behind it, Carnival is a great value play this September and for months to come.

This is a top stock to buy. Its price has been on a steady rise since March this year, an indicator of the positive changes in the broader market.

Johnson Matthey

Revenue growth consistency

Johnson Matthey is another UK stock that could be too cheap to miss. The stock is trading at a 3-month low, and with the FTSE 100 on the rise again, this makes for a perfect value play.

One of the things that make this British stock attractive under current market circumstances is its beta value.

The company has a beta value of 1.21, which, while risky in a falling market, presents significant opportunities for growth in rising markets.

UK stock markets have started August in the green, and due to its high beta, Johnson Matthey PLC is already proving to be one of the likely top performers in the month.

With vaccine levels now at over 50% in the UK and other developed countries, the markets are likely to keep gaining not just in September but potentially for the rest of the year. This makes Matthey PLC highly undervalued at current prices. 

Aside from overall market factors, this stock has the fundamentals to back it up. For starters, the need to cut emissions is growing, not just in the UK, but globally.

This means the products that the company offers are in demand, a factor that could play into its price action as the market rises.

The company’s financials are pretty solid too. Its revenues have been on the rise for the last 4-years. While the pandemic affected the revenues of a lot of companies, JMAT revenues have been pretty consistent.

This stock’s technical indicators also paint a picture of growth.  Key moving averages point to this stock as a strong buy, and the same goes for the Fibonacci retracements.

If it pushes through significant resistance at GBP 3100, it could be in the green for weeks, if not months.

It’s definitely a stock worth keeping an eye on this month.

MobilityOne Ltd

The e-Payments winner

MobilityOne is also a cheap UK stock you should consider to own. The stock has been trading in a range for the past month. After a steep drop in May and June, it seems to have found support at around GBP 23.

With the FTSE turning green, this stock has the potential to bounce off this support in September.

Several fundamental factors make this stock a pretty good buy at current prices.

The first one is that it now has a MasterCard license to issue prepaid cards in Malaysia. While this is pretty old news, it will play positively to its revenues going into the future.

It adds to the company’s intrinsic value and could play into its value growth now that equity markets gain upside momentum.

There is also the fact that the company operates in one of the fastest-growing markets in the world. As more people turned to online shopping during the pandemic, e-commerce has become hot.

This places industry players in pole position for intrinsic value growth. At current prices, this fact makes MobilityOne shares pretty undervalued.

The company’s financials paint a picture of growth too. In the 6-months that ended 30th June 2020, for instance, the company’s revenues rose by 52%.

With demand on the rise for its products, this growth is unlikely to slow down anytime soon.

The technicals also paint a picture of growth. This stock has been bouncing off a key support level for a month, an indicator that bears cannot push it through the GBP 23 price level after a heavy selloff earlier.

The stock also has an RSI reading of 67.80. This is indicative of a stock that is in a buy zone.

For a stock trading at a key support level, the bull power reading is pretty bullish too, at 16.42.

All these factors make it a pretty undervalued stock at current prices.

Bellway

The housing market is still strong

Bellway is at an interesting price level at the moment. After falling for close to a month, it has found strong support at GBP 3200 and has been trading at this level for weeks now.

This is an indicator that bears are losing steam at this price level. This is quite interesting when put in the context of data on the construction industry in the UK.

Data shows that despite the UK home markets cooling down, the market has grown by over 1%.

This has been driven by higher selling prices and strong forward sales. Government tax breaks have also helped boost this market. These factors are likely to play into this stock’s value this month, especially now that it is trading at support.  

The FTSE 250 is also on a rebound, and this, too, makes Bellway an exciting stock to watch. That’s due to the stock’s high beta value.

Bellway has a beta of 1.73, and while this is risky in bearish markets, it’s a bullish factor in rising markets. It is an indicator that the stock can outperform the market.

Another factor that makes Bellway relatively undervalued is that it is dividend-paying stock.

Dividend-paying stocks are usually some of the most stable in the market, and Bellway has quite a healthy dividend yield of 2.59%. For a stock this fundamentally strong, it is trading at a heavy discount compared to 3 months ago.

It is one of the stocks that can outperform the market now that bullish sentiment is rising in the broader UK equity markets.

This momentum is already showing in its price action.

Ceres Power

A renewable energy tech advantage

Ceres Power is another stock that is highly undervalued at current prices when understood in the context of prevailing market circumstances.

The stock has been trending downwards for the last three months but seems to have found support at around GBP 990. 

The stock’s news is largely positive, too, an indicator that its core fundamentals are getting better.

Last month, the company reaffirmed to investors that after recording strong growth in the first half of the year, it expected strong revenues growth for the full year. That’s bullish news and could play into its value growth in September and beyond.

The company has some positive news related to its technology development too. In early June, the company released its latest solid-oxide electrolysis technology.

The technology puts the company in a good position in the clean energy market. That’s because it is designed so that it operates in a reverse manner compared to the fuel cell.

Essentially this means the company is in a position to deploy it while leveraging on the technologies it already uses.

The biggest aspect of this technology is that it can help the company increase energy efficiency by up to 95%. This is a level that no other tech in the game has, which is a huge deal to the company’s value.

The technicals are painting a picture of potential growth too. The stock’s monthly RSI has a reading of 61.82, which is a strong buy.

Another important indicator is the bull power, and Ceres currently has a reading of 66.63 for the month. This is indicative of strong bullish sentiment and a strong buy signal for this stock.

Combining this with the fact that the broader market is rising, and Ceres has a high beta of 1.09, it is not hard to see why it is a relatively undervalued stock at current prices.

eToro – Buy the Best UK shares With No Commission

etoro broker

eToro have proven themselves trustworthy within the stock market over many years – we recommend you try them out.

Your capital is at risk. Other fees may apply

Read More:

How to Find Cheap UK Shares to Buy Now

3 UK Stocks To Watch This Week

3 Top UK Stocks You Can Buy And Hold For The Next Decade

FTSE 100 Investing: 2 Bargain Buys to Consider Today

Top UK Shares

5 UK Growth Stocks To Buy Today

7 UK Shares To Buy Now With £5,000

Top Brokers in
    All Regulated Brokers
    67% of retail clients lose money when trading CFDs with this provider.