Top 5 British Stocks For October 2021

Last Updated September 29th 2021
5 Min Read

The COVID-19 pandemic has hit the United Kingdom as hard as the rest of the world. The lockdown restrictions halted almost all business activities and sent the stock market plummeting in early 2020. However, the market condition is on the mend, and experts have become increasingly optimistic about the overall economic growth

Despite the lingering concerns about inflation, investors are focusing more on some of the best UK stocks and expect significant gains from them. As we look at the top 5 British stocks for October, here are the companies that are all set to be the top performers this year.

Top 5 British Stocks For October 2021

  1. Oxford Biomedica
  2. TI Fluid Systems
  3. Smith & Nephew
  4. Airtel Africa
  5. Rolls Royce

1. Oxford Biomedica

Biotech companies are showing fast recovery in the post-pandemic world. Oxford Biomedica (OXB) is a popular biotech company that specializes in the development of gene-based medicines. OXB has seen a huge increase in its share price and reached the highest point over a decade in June. 

Oxford Biomedica was known for the establishment of a unique proprietary drug platform known as the LentiVector. By deploying this platform, larger pharmaceuticals like Bristol Myers Squibb and Novartis can easily pursue new treatments that would otherwise be too expensive or even technically challenging. 

The reason for the significant rise was the company's initiatives to tackle the worsening pandemic. Eventually, the firm landed one of its most lucrative partnerships to date with the manufacture of AstraZeneca’s Covid-19 vaccine. 

The single contract had the potential to double the firm’s revenue stream. Even though the bulk of income originating from a single source is always at the risk of compromise in the future, Oxford Biomedica is at the peak of new heights today. With several other developments in place, OXB is certainly one of the top 5 stocks to consider for October. 

2. TI Fluid Systems

TI Fluid Systems might not be the most widely known stock at the time, but it has received massive traction from a substantial price increase on the LSE over the past few months. 

The company manufactures fluid storage, carrying, delivery, and thermal management systems for light vehicles. Like any other stock, the pandemic has impacted TI Fluid System’s sales also drastically. But the stock is almost in the middle of recovering from the market crash. 

There was a considerable increase in the share price of TI Fluid stocks in the first quarter of 2021. Based on this colossal growth, the management is expecting free cash flow to return to pre-covid levels this year.

Combining its price growth with the income being generated from the vast collection of other products developing on LentiVector, 2021 will be a transformative year for the stock, making it one of the top 5 British stocks for October. 

3. Smith & Nephew

As elective routine procedures took a back seat during the pandemic, medical device industries like Smith and Nephew have suffered a considerable loss. But with Covid-19 vaccine programs gaining pace, things are looking good for this FTSE 100 company. 

Smith & Nephew operated across three segments: orthopaedics, sports medicine & ENT, and advanced wound management. Additionally, the company is well placed in a position to benefit from the world’s ageing population. The increase in the number of people over 60’s globally in the coming years would boost the demand for its products, resulting in high share prices. 

Since the revenues were up in Q1 2021 across all the franchise segments, the stock reward profile is quite attractive compared to its competitors. If the company maintains its momentum with new executions, Smith & Nephew can see record heights by the end of this year.

 

4. Airtel Africa

Airtel Africa’s earnings have been skyrocketing over 83% per annum for the past five years. It is a prominent telecommunications firm that has been operating in over 14 different African countries. It has a strong track record of continuous growth and is expected to keep its momentum in the coming decades. 

Since the African telecoms industry is still in its infancy stage, there are several opportunities to capitalize on the growing market for Airtel Africa. This FTSE 250 firm has reported over 25% profit growth for the year till March 31. Experts say that Airtel Africa has long-term growth potential and would outperform the mature telecom markets of western Europe and the U.S. It has also signed a deal to sell a 3.75% stake in its mobile money operations to the global payment processor Mastercard Inc for $100 million. 

5. Rolls Royce

The Rolls Royce share price has been edging up to new records over the past few weeks. According to recent news, the engine manufacturer and defense contractor Rolls-Royce is planning to sell off its Spanish subsidiary ITP Aero. This is one significant factor behind the rapid growth of the stock in August. 

This would also allow the company to pay off its massive debt pile and brighten its prospects. Further, Rolls-Royce has also started gaining huge institutional interest again from the market. For instance, the interest from broker Berenberg to forecast a near 50% target increase is itself a prime example. 

Also, for starters, the stock is a classic reopening play. It generates a significant portion of its revenue from the servicing of jet engines. Therefore, once the travel industry reopens, the company would further benefit from the increased sales. 

It's worth mentioning that analysts at Jefferies in June listed Rolls-Royce as one of their top picks for the post-pandemic growth cycle. With the economic market rising back, Jefferies expects some companies to embark on a period of bonanza, and Rolls-Royce tops that list. 

Yet another reason for its popularity is that it is working hard to become a more sustainable company. It has outlined plans to reach a net-zero emission by 2050 by investing more in decarbonizing technologies. For the short term, it is deploying more sustainable aviation fuel as the initial steps to sustainability. 

The Bottomline

Just like other sectors, the stock market is also rebounding from the recent market crash and inflation at a very rapid pace. The above mentioned are some of the strong UK stocks positioned to benefit even from the structural tailwinds in a recovering economy. So if you have plans to invest in the stock market, these are the top 5 British stocks to look out for in October. 

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