2025 share tips: what the financial experts are backing

2024 Morphing To 2025 Over Financial Bar Graph Background

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last updated 10 January 2025

After a creditable 2023, last year marked a return to gloomy form for the media’s stockpickers. While four of the ten annual portfolios did manage to beat the London market’s sluggish performance, the rest either stagnated or lost money. In a market dominated by Wall Street, digging up an underrated gem was often less rewarding than simply buying into the same US technology behemoths as everyone else.

We look at how the tipsters’ share tips performed in 2024.

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No wonder Nvidia was a core holding in the portfolio of this year’s table-topper – Investors’ Chronicle (IC). The AI chip specialist surged 179% last year, a reminder that sometimes the best picks are also the most obvious. The IC’s four other top picks – including Babcock and London Stock Exchange Group – all managed to turn a profit, helping to redeem a poor showing in 2023 that was blighted by an ill-timed call on the lithium market.

Shares is the only other publication to have outperformed the FTSE this year. The magazine’s 91% gain from annuities and lifetime mortgage specialist Just Group provides comfort to stockpickers everywhere, proving that buying “a well-run company whose stock looks anomalously cheap” can still be rewarding. Yet sometimes you can get the analysis right and still lose money. The magazine’s tipsters were “shocked” by a 34.2% loss at B&M European Value Retail despite a “relatively resilient operating performance” and a favourable backdrop for budget retail.

Interactive Investor’s Aim portfolio was a mixed bag. Mining royalties investor Trident Royalties was the best pick, with a 36% gain before it was taken over in September. But the performance was undermined by a 48.9% loss at motion capture software specialist Oxford Metrics amid weakness in its video games-to-entertainment markets. Tipster Andrew Hore notes that the portfolio’s 1.8% gain easily beats the 6.7% fall for the FTSE Aim All Share, the portfolio’s benchmark.

The Mail’s Midas portfolio topped the charts last year, but falls to second-to-last place this time. The paper’s Midas columns tend to take a “go big or go home” approach, with bold picks that can go spectacularly right or horribly wrong. This year misfortune dominated, including a 61% plunge at cultivated meat play Agronomics. Lab-grown meat is a compelling technology, but in investing being early can be the same as being wrong. The only gain came from Royal Mail owner International Distribution Services (up 33%), showing at least that the postal service sometimes does manage a Christmas delivery.

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Tipsters’ performance in the last five years
Tipsters	2020	2021	2022	2023	2024
Investors’ Chronicle	-5.1%	15.3%	-24%	-3.1%	47%
The Times	-10.1%	6.4%	-12%	17%	13.3%
Barron’s	9.9%	26.9%	-1.7%	31%	11.4%
Shares	4.8%	8.6%	-21.3%	20.6%	8.8%
Interactive Investor	70.1%	25.8%	-47.4%	-7.9%	1.8%
Evening Standard	-19.8%	-2%	-31.2%	22.1%	0.9%
Motley Fool UK	N/A	N/A	-24.6%	0.6%	0.7%
The Telegraph	-1.3%	16%	-30.5%	0.6%	0.5%
The Mail	20.9%	5.8%	-26.8%	46.3%	-12%
The Sunday Times	7%	2.3%	-36%	20.9%	-13%
FTSE 100	-14.3%	14.3%	0.9%	3.8%	5.8%
FTSE 250	-6.4%	14.6%	-19.7%	4.5%	5.7%

Annual share portfolios are to be taken in a spirit of seasonal fun. But they do provide an opportunity to take stock and reflect on wider market trends. Last year was far from a vintage one for stockpicking. Indeed, it has become something of a joke in the City that active managers declare each new year to be the “year of the stockpicker” – only to lose once again to passive index funds. But not all trends last forever. If Big Tech wobbles over the next 12 months and value investing makes a comeback, then some of the ideas below might just be set for a very happy 2025.

Google-owner Alphabet has come under pressure amid competition from AI chatbots and US antitrust probes, but the shares now trade on an “unjustified discount” to the likes of Microsoft. The search operation remains robust despite the AI threat, while the cloud business is outgrowing its rivals. This looks like a good opportunity to buy into a world-beating technology innovator ($187). Profits at actuarial and investment consultancy XPS Pensions have doubled over the past five years as higher interest rates turbocharge defined-benefit pension schemes. The shares aren’t cheap, but the rating is justified by the firm’s compelling mixture of growth and defensive, recurring revenue (326p).

Shares in travel-ticketing specialist Trainline soared more than 30% last year, and 2025 spells new opportunities. Europe is liberalising its rail market, giving the business scope to seize market share comparable to the commanding lead it already enjoys in the UK. Expect the shares to go “full steam ahead” (397p). Operational hiccups have “hammered” shares in explosives specialist Chemring, leaving it on a discount to other UK defence players. This is an appealing entry point into a sector enjoying soaring demand as defence budgets rise across Europe (333p). Listed property players are on large discounts to net asset value (NAV) because of high interest rates. “Last mile” warehouse landlord Urban Logistics Reit has been further squeezed by post-Covid re-opening, but it is finding ways to refurbish assets to command higher rents. A 7% dividend yield is also appealing (99p).

Faltering efforts to grow its US operations have left Qinetiq out in the cold; the valuation has not risen much since Russia invaded Ukraine. However, two-thirds of revenue stems from the UK and “long-term contracts”, and “impressive” cash conversion testify that this is a quality business. On a forward price/earnings (p/e) rating of 12.9, this is one of the cheapest defence stocks (409p). US hedge fund star Bill Ackman’s listed Pershing Square vehicle offers exposure to high-quality holdings and looks too cheap given Ackman’s “very strong long-term record” (4,078p). Shares in BP are some of the “cheapest” in the energy sector, on a forward p/e of eight. Questions remain about its green targets, but “expectations are mounting” that the new management will backpedal on old promises. A renewed focus on high returns coupled with “chunky cash returns” could prompt renewed interest from investors (420p).

Scottish Mortgage Investment Trust has fallen out of favour of late with investors as higher rates squeeze some of its more speculative growth bets. However with rates now falling the trust could be poised to outperform, while buybacks should help to narrow a discount to net asset value (989p). Data and analytics giant Relx’s forward p/e of 30.5 is justified by its “reliable earnings growth”. Set to leverage AI and with healthy growth in its legal operation, Relx is a “quality compounder” (3,759p).

Alibaba may be the world’s “cheapest e-commerce and cloud computing” stock on a p/e of just ten. There are concerns about Beijing’s “mercurial attitude” towards domestic tech firms, Trump’s tough stance on China, and the effectiveness of economic stimulus measures. But if investors “warm to the depressed Chinese stockmarket” the shares could surge 50% in 2025 ($89). ASML has “virtually no competition” in high-end extreme ultraviolet lithography machines, which has made it Europe’s second-largest tech company. The Dutch company, on 28 times 2025 earnings, is a “cornerstone investment in the semiconductor supply chain” and expects spending on lithography to support it through to 2030 ($714).

Berkshire Hathaway’s Class A shares kept up with the S&P 500 index in 2024. Warren Buffett’s investment vehicle is probably the “most defensive megacap stock” thanks to its $30 billion cash pile. If the market falls, Buffett may invest this cash for an “elephant-size acquisition that he has long sought” ($676,604). LVMH’s prospects could improve in 2025 amid an expected revival in the luxury goods market and a recovery in China, its largest market. The shares are “inexpensive” at 23 times earnings. HSBC analysts deem the stock a buy thanks to LVMH’s greater exposure to the stronger US market than peers and projected organic sales growth of 4% this year. CEO and top shareholder Bernard Arnault has spent more than $100 million buying stock ($135).

Alphabet is an “outstanding growth business” with strong AI opportunities. The valuation gap with other Magnificent Seven stocks will narrow over the next 12 months as “sentiment improves and growth outperforms”. Regulatory challenges are a concern, but the risk of a full break-up seems unlikely, and worries over huge investments in AI eating profit margins also look misplaced. In addition to the cloud-computing business, Alphabet is betting on its Waymo robotaxi business and quantum computing ($187).

Digital transformation services provider TPXimpact Holdings has restructured and slimmed down. Two-thirds of revenues come from central government and a third from local government. TPXimpact has won high-profile, multi-year deals worth £76 million in total, and it is well-placed to take advantage of more state spending on digitisation. The stock, on a p/e of less than ten, is “undervalued” (42p).

Profit at builders’ and plumbing merchant Lords Group Trading has slumped in the past two years “but this year should mark the bottom”. There are signs of recovery in the repair and maintenance market, which accounts for 80% of sales, and this should accelerate in 2025. Lords operates in a fragmented market with potential for further consolidation. The shares trade on 12 times estimated 2024 earnings, falling to less than nine for 2025 (37p).

Gooch & Housego was hit by destocking in 2024, but the photonics products supplier is improving. The industrial unit is the main revenue generator and has seen strong demand for subsea data networks, although the industrial laser business has been weaker. Underlying pre-tax profit fell 22% in its latest financial year. Pretax profit is set to rise to £13.3 million this year, then to £17.8 million next year and the share price is starting to gain. “Buy for recovery” (490p).

Aviva is “one of the FTSE 100’s best bargain shares” with a dividend yield of 8%. The insurer has “considerable investment potential over the long term”, and sales are expected to “steadily rise as demographic changes drive demand for retirement products like pensions and annuities”. The possibility of economic conditions worsening in the core UK and Ireland markets this year is “baked into” the “rock-bottom valuation” (483p). JD Sports Fashion’s shares fell 15.5% in November on a profit warning for fiscal 2025. Now the stock is a “bargain”. Despite a sales slowdown in all territories in the third quarter, the full-year impact of the recent acquisition of 1,169 shops in the US will “help restore confidence” in the long term (101p).

NWF Group’s shares “look like a bargain”. The distributor of fuel, animal feeds, and food has a proven business model and an established customer base with limited competition. Despite thin margins, NWF is a “consistently profitable company” with a “generous” dividend. The company ended its last financial year with £10 million net cash, more than a seventh of its market value (157p).

AstraZeneca is “not a one-trick pony”, and while cancer drugs account for a third of sales, the pharma giant is developing treatments for kidney issues, cardiovascular disease, respiratory problems, rare diseases, and immunology. The stock has fallen 12% in the last three months thanks to regulatory investigations in China, but the decline is a buying opportunity. Britain’s largest listed company recently upgraded full-year guidance for revenue and earnings and is targeting $80 billion of revenue by 2030 (10,704p).

Assura builds and manages 620 healthcare facilities such as GP surgeries and private hospitals. Earnings and dividends have grown over the past decade, and last year the company bought 14 hospitals for £500 million. They are expected to drive growth in 2025 and beyond. Although the shares have halved since 2022, Assura is forecast to raise the dividend by 3% to 3.3p for fiscal 2025, with a “generous” 8.5% yield. The stock offers “long-term growth and highly attractive dividends” (37p).

Telecom Plus, trading as Utility Warehouse, combines energy, internet, mobile phone, and home insurance bills into one payment. The £1.4 billion company has over one million customers. It aims to have two million in the next seven years and add more services to its plan. Analysts project a 94p dividend for fiscal 2025, rising to 107p next year and 118p in 2027, producing a 5.5% yield. The shares peaked at 2,500p two years ago amid high energy prices and inflation. They have since fallen 30%, but should bounce back in 2025 (1,659p).

Distribution Finance Capital provides finance to hundreds of specialist car dealers through loans (subsidised by manufacturers) that are repaid as soon as vehicles are sold. Results for 2024 are expected to beat projections with profits of more than £18.5 million, a fourfold increase from 2023. The shares have declined from 130p in 2019 to 36p today owing to Covid, high interest rates, and the collapse of a manufacturer. But they now look cheap. The company should deliver “strong” growth in 2025 and beyond (37p).

SSP runs food outlets like Upper Crust at airports and railway stations. The company’s finances have failed to respond to booming air travel, largely thanks to “management mess-ups” and struggling markets in Germany and France. But the “tide may... be turning”. The group has revealed a strong set of results and a management shake-up. The stock trades at 15 times 2025 profits, around half its prepandemic valuation. A plan to float SSP’s Indian joint venture went largely unnoticed but suggests the stock could “finally take off in 2025” (175p).

Rentokil Initial’s $6.7 billion acquisition of US-based Terminix in 2021 made the FTSE 100 company the world’s biggest pest-control business but proved “troublesome”. Activist investor Nelson Peltz’s Trian Partners entered the fray just before September’s profit warning caused by unexpectedly slow US sales, and he placed a representative on Rentokil’s board. “Peltz will not tolerate underperformance for long” and may “shake things up... he will want to make money” on his 2.5% stake (389p).

Hammerson’s shares came under pressure between 2018 and 2020 because tenants struggled to pay rent, and the stock has “bobbed along” since. The shopping centre owner sold its 42% stake in Bicester Village owner Value Retail last year for £1.5 billion. This removed the “jewel from Hammerson’s tarnished crown” but eased the way to a possible takeover. That had previously been thwarted owing to the complex structure of shareholdings at the group, which would have been a “poison pill for would-be buyers”. Acquirers are now returning to the market as valuations have plateaued. “A takeover, or a breakup… could give those buying in now a healthy return.” (269p)

Recruitment firm Robert Walters’s share price could rebound this year thanks to “greater political and economic certainty”. The shares have fallen nearly a third in three years amid a weak recruitment market. Still, the market is “at, or near, rock bottom”, and so “with greater certainty will come greater business confidence”. The industry is unlikely to reach Covid-era levels of recruitment activity, but hiring could begin to recover, boosting fees and the share price (320p).

Alex is an investment writer who has been contributing to MoneyWeek since 2015. He has been the magazine’s markets editor since 2019.

Alex has a passion for demystifying the often arcane world of finance for a general readership. While financial media tends to focus compulsively on the latest trend, the best opportunities can lie forgotten elsewhere.

He is especially interested in European equities – where his fluent French helps him to cover the continent’s largest bourse – and emerging markets, where his experience living in Beijing, and conversational Chinese, prove useful.

Hailing from Leeds, he studied Philosophy, Politics and Economics at the University of Oxford. He also holds a Master of Public Health from the University of Manchester.