I think these could be two of the best UK shares to buy for my portfolio and hold at least until the end of the decade. Here’s why.
A top electric vehicle stock
The electric vehicle (EV) revolution offers UK share investors like me many money-making possibilities. The International Agency predicts there will be 145m electric cars on the world’s roads by 2030. That’s up significantly from the 11m in 2020. It says the number could even reach 230m, if governments get serious on meeting their emissions targets.
I myself have invested in car parts manufacturer TI Fluid Systems and I’m considering buying Trifast (LSE: TRI) too. This particular company makes screws, bolts and other fastenings that can be found in consumer electronics, solar panels, white goods and a broad host of other products. But Trifast’s single-biggest money spinner is in the manufacture of parts for light and heavy vehicles. Collectively these account for 35% of group revenues.
Trifast makes bespoke products for autos and so it’s built strong relationships with carmakers all over the globe. This is especially critical as OEMs select trusted suppliers to help them overcome the challenges that these new technologies create. I think Trifast’s in great shape to exploit the EV boom too because low-emission vehicles require more fastenings than conventional petrol-powered vehicles.
My main concern from an investment standpoint is that this UK share doesn’t come cheap. At current prices it trades on a forward P/E ratio of 26.8 times. This is the sort of high valuation that could prompt a sharp share price reversal if trading conditions worsen. For example, if broader supply chain problems in the auto industry hit demand for its fastenings and revenues subsequently fall.
Another fast-growing frontier
Still, from a long-term perspective I think Trifast has a lot to offer. It’s a view I take with regards to gaming software designer Frontier Developments (LSE: FDEV) as well. I expect earnings here to rise strongly as video games sales soar. Analysts at GlobalData think the global games industry will be worth $452bn by 2030. That’s double what the market was estimated to be worth last year.
Frontier Developments has a plethora of popular titles in its stable. Games within the Jurassic World Evolution franchise and Planet Coaster and Planet Zoo canon sell in huge numbers and it has some massive titles coming down the pipe soon. These include games under the hugely-popular Warhammer wargaming banner and a new F1 motor racing motor management game.
It’s worth bearing in mind that the video games market is highly competitive and strong sales are never guaranteed. Indeed, a crowded release window at the end of 2021 prompted weaker-than-expected sales of Jurassic World Evolution 2 and a subsequent scaling down of full-year revenues forecasts. That said, I still think the company’s long track record of success makes it an attractive buy for the video games boom. It’s one of a selection of white-hot UK growth shares I have my eye on.
Royston Wild owns TI Fluid Systems. The Motley Fool UK has recommended Frontier Developments. 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.
