I fancy doing some last-minute stocks shopping before markets close down for Christmas. Here are two top penny stocks I’m thinking of buying.

Riding the copper demand boom!

Escalating trouble in the Chinese property market poses a threat for many UK commodities shares. Profits could take a tumble if the problems faced by Evergrande spread and demand for metals, for example, slumps. Still, as someone who buys share with a long-term view I think copper shares like Phoenix Copper (LSE: PXC) remain ultra-attractive right now.

It looks as if copper demand is set to explode over the next decade. This isn’t just because rising concerns over climate change should supercharge electric vehicle sales and investment in renewable energy technology. It’s because demand for consumer electronics looks set to rocket in emerging markets as personal wealth levels increase.

Bank of America recently tipped copper to hit $20,000 a tonne by 2025 as copper shortages emerge. That’s up from just below $9,300 today. Phoenix Copper is due to restart production at the Empire Mine in Idaho in 2022 to capitalise on improving red metal consumption.

A word of warning: a swathe of new production capacity entering the market could harm the prices UK shares like this can ask for their metal. Analysts at ING Bank recently warned that “the expansion of some Chinese players such as Daye and some new projects in Indonesia and India” could keep refined supply high over the next few years.

Another top penny stock for commodity lovers

Phoenix Copper isn’t the only dirt-cheap commodities stock I’m considering buying today. An environment of soaring prices means I’m also thinking of investing in Scotgold Resources (LSE: SGZ). This is because I think inflationary pressures could increase at an alarming rate, in turn boosting classic safe-haven assets like gold.

The Bank of England decision last week to raise rates despite the worsening Omicron crisis illustrates how seriously the inflationary threat is becoming. Deutsche Bank analysts upgraded their inflation forecasts in recent hours (they now expect British CPI to exceed 6% next spring). This comes after UK inflation hit new 10-year highs in November and beat broker forecasts by around half a percentage point. Plenty of other economists are rethinking their global inflation targets following recent data.

It’s true that rate hikes by central banks could hit gold demand and by extension profits at Scotgold. This could be particularly damaging if the US Federal Reserve engages in regular rate hiking, a trend that would likely push the US dollar higher. This could damage investor interest in gold as it would make dollar-traded commodities like this less cost effective to buy.

But it’s my opinion that banks will be reluctant to raise rates too much as the pandemic rolls on, keeping the inflationary bubble going. Scotgold operates the Cononish gold mine in Scotland where production is steadily being ramped up.

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.

Rivian (NASDAQ: RIVN) stock was one of the most hotly anticipated electric vehicle (EV) IPOs this year. The company, which is yet to produce any revenues from vehicle sales, surged in value after it hit the market.

Although the shares have since lost some ground, the corporation remains one of the most highly valued operations in the space. Its market value stands at around $80bn.

By comparison, Ford, one of the world’s largest and most storied car manufacturers, has a market capitalisation of just under $80bn. Ford’s annual revenues are in the region of $150bn. 

Former partners 

I picked out Ford in this example after the US car giant invested around $500m in Rivian for a 12% stake in 2019 after the two parties agreed to work together. However, that agreement fell apart in November, with Ford realising it no longer needed the startup to help meet its EV ambitions. 

In fact, Ford now believes it can become the second-largest EV producer in the world within the next two to three years. The company targets an annual output of 600,000 units, although that is still a long distance behind Tesla’s current annualised production rate of around one million units. 

So where does this leave Rivian? It is difficult to tell. The company recently informed the market it will struggle to hit its initial target of producing 1,200 vehicles in the fourth quarter of this year.

Nevertheless, both the company and Wall Street analysts remain optimistic that reservations for its flagship electric pickup will surpass 100,000 by the first half of next year. If the business can overcome current supply chain issues, analysts argue, it may be able to ramp up production significantly as orders flood in. 

The outlook for Rivian stock

Taking orders is one thing. Meeting orders is another issue altogether. Clearly, there is demand for the company’s EVs, but it is impossible to tell if this will persist for the next few years. It is also impossible to tell if the corporation will be able to satisfy this demand.

Ford and Tesla are experienced operators with a proven track record. Indeed, Ford’s global supply chain and manufacturing footprint give it the edge over Tesla and Rivian. That said, it still has some way to go before it has Tesla’s brand recognition. 

Considering these factors, I think Rivian stock will still be struggling in five years. It is impossible to say where the shares will be trading in 2026. Considering the competitive environment and the amount of work the business will have to do to catch up to its larger competitors, I think the corporation will struggle. As such, I will not be buying the stock.

I would rather own a more established firm such as Tesla or Ford. Their competitive advantages will be instrumental in gaining an edge in the EV market. 

Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.

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Warren Buffett is widely regarded as the greatest investor of all time. In the 1980s, he became a billionaire, and his tenure at Berkshire Hathaway has seen its A shares grow in value to almost $400,000. What lessons can we take from him? Actually, quite a few. Throughout the years, Warren Buffett has offered a thorough overview of how he makes the types of investments that yield double- or triple-digit returns in interviews, books, and letters. Here are some of the most vital rules he follows to help ensure success.

Warren Buffett says “be patient“

Buffett believes that patience is the most important value an investor can have. There may be a fantastic firm out there, but if the stock price is too high, it’s best to wait for it to fall. There may be a market crash, and your assets may lose value, but if you wait long enough, the price may rise again.

Even if it doesn’t appear so, the stock market is continually presenting fresh chances. All we really have to do is wait for them.

Focus on your circle of competence

It is vitally important that I understand the business I’m investing in. Warren Buffett has been criticised for losing out on the boom in tech companies over recent decades. However, he has always stated that he does not understand how those firms create money and hence does not invest in them. That’s not to imply Facebook or Google are untrustworthy firms; it’s just that he wouldn’t know the difference between a good and a bad investment. For the same reason, I avoid investing in banks, but I do invest in renewable energy.

As we gain confidence in our investing, it is always a good idea to attempt to learn more about other companies and sectors. But Buffett encourages us to focus on what we currently know well. In an interview with CNN, another well-known investor, Peter Lynch, reiterated a similar stance, “I know restaurant managers who invest in IBM, but I always ask why they don’t invest in restaurants. They know how the business works. They know if a restaurant is profitable and what sorts of challenges they face”.

Ignore the share price. What’s its value?

Warren Buffett is a firm believer in the necessity of sound business principles. Observing a stock’s rise and fall is, for the most part, frustrating, draining, and unproductive. Many inexperienced investors make the mistake of purchasing when the price rises and selling when the price falls. However, there are a multitude of other factors that influence share prices. Not only is it hard to forecast these fluctuations, but they typically reveal next to nothing about a company’s health.

If, on the other hand, an investor learns how much debt a firm has, how much cash it has on hand, and whether it makes a consistent profit, they will be in a much better position to determine whether the company is healthy or not.

James Reynolds has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.

I think investing in the stock market for passive income is a great strategy. Unlike other income strategies, such as buy-to-let investing, it is possible to start investing in the equity market with a lump sum as small as £10.

I can also invest alongside some of the best company managers globally, who will take care of the day-to-day management of these businesses. Unlike investing in rental property, I do not have to worry about chasing tenants for rent. I can leave that job to the companies’ CEOs. 

It is also possible to build a more diversified portfolio with stocks and shares. I can invest in companies in different industries all over the world with the click of a button.

Unless I had a few million pounds in startup capital, it would be virtually impossible to replicate the same kind of diversification with property. 

With that being the case, here is how I would invest in the stock market for passive income in 2022. 

Passive income investments

While I am not going to be buying a rental property, I would purchase homebuilders for my portfolio. The UK housing market is structurally undersupplied. That is good news for companies like Persimmon and Taylor Wimpey, some of the largest listed UK home builders. 

Considering their position in the construction market, I think these companies can continue to generate healthy amounts of cash. They are both returning as much cash as possible to investors with dividend yields of 8% and 7%, respectively. 

Still, while these companies are dividend champions today, I will be keeping an eye on supply chain pressures. These could increase their costs and reduce the amount of cash available for distribution to investors. 

I would also buy utility suppliers for my passive income portfolio in 2022. Companies like United Utilities and Severn Trent would fit the bill perfectly. Together these companies support an average dividend yield of around 3.5%. This is not the highest yield available on the market, but it is backed by the income from these companies’ water assets.

In my opinion, it is worth sacrificing yield for the defensive qualities in this situation. 

However, I will also be keeping an eye on the regulatory situation around these companies. Regulators are threatening to clamp down on excessive profit margins in the water sector. This could lead to reduced dividends. 

Dividend income

According to my calculations, if I invested £10,000 in the four companies above, I could generate an annual dividend yield of 5.5%. That would give me a passive income of £550 a year. 

If I could invest a lump sum of as much as £250,000 in these equities this would be enough to generate a passive income of £13,750 per annum or £1,145 a month. This excludes any capital growth earned on the shares. These are the reasons why I believe this strategy is the best way to generate a passive income. 

Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.

This year has been a mixed one for the BP (LSE: BP) share price. The stock has returned 26%, excluding dividends over the past 12 months.

However, despite this performance, it is still trading around 20% below its pre-pandemic level.

This seems odd because the price of oil has recovered all of its pandemic loss in 2021. Therefore, it does not seem unreasonable to suggest that the BP share price should reflect this performance. 

The company’s profits support this conclusion. For 2019, BP’s net income totalled $4bn. It earned that in the first quarter of 2021 alone. 

Considering this backdrop, I think there are three potential scenarios that could dictate the direction of the company’s stock in 2022. 

The outlook for the BP share price

In my opinion, there is one big reason why investors are not buying shares in the oil giant today, which is uncertainty. Uncertainty about the global economic recovery and uncertainty about BP’s place in the global energy transition. 

Many analysts believe that the world will begin to return to some sort of normality next year after two years of pandemic disruption. This should meet some investor concerns about the outlook for the global economy. 

At the same time, BP is investing heavily in its renewable energy business. With every month that passes, the company’s green energy division grows. 

Revenue from this part of the business will make a substantial contribution to the top and bottom line by 2030. This implies investors will have to wait several more years to see how the company moves through the energy transition. But it is moving in the right direction. That is what really counts. 

Put simply, I think some of the uncertainty surrounding the BP share price should dissipate in 2022. Investors could begin to return to the company as a result, especially if profits continue to flow. 

No guarantee

Unfortunately, there is no guarantee that confidence will return in 2022 or that profits will continue to flow. Uncertainty may continue to prevail next year, and in this situation, I think the stock would continue to underperform the market. 

BP may also attract more unwanted attention due to its oil and gas industry exposure. This could lead to costly court battles and even potential fines. 

Still, even after taking these challenges into account, I think the stock is an attractive investment for next year.

Even if the company continues to fly under the rest of the market’s radar, the shares offer a dividend yield of 4.5% at the time of writing. Management has promised to return more cash to investors through share buybacks if profits continue to outperform expectations. By returning a healthy chunk of cash to shareholders, the corporation could add some support to the share price and attract income investors. 

As such, I would be happy to buy the stock for my portfolio ahead of a potential re-rating in 2022. 

Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.

As well as hunting for UK equities to buy for my portfolio in 2022, I have also been searching out US stocks to buy. I think it is vital to look overseas when searching for top investments as it opens up a vast universe of businesses. Some of these firms have no comparable peers in the UK. 

As such, here are three US stocks I would buy for my portfolio in 2022. 

US stocks to buy for growth 

Google’s parent company, Alphabet (NASDAQ: GOOG), is one of the world’s largest technology corporations. It has built its brand over the past two decades through the Google search engine, but today, the establishment is far more than a web portal. 

Alphabet owns cloud computing assets, a hardware and software business, and has a portfolio of startup bets. Together, these assets suggest that the business is built for whatever the world throws at it.

They also indicate to me that this company is one of the best ways to invest in the growth of the global internet infrastructure. As the technology sector continues to boom, the business should reap the benefits. 

These are the main reasons I would buy the shares for my portfolio for 2022 and beyond.

Some challenges it could face include regulatory headwinds, which could force the breakup of the business. This is the worst-case scenario. 

DIY giant

Home Depot (NYSE: HD) has been one of the big winners of the pandemic. Stuck-at-home consumers have flocked to the firm’s stores to purchase tools and equipment for DIY projects. And even though the world has opened up over the past few months, the US retailer’s sales have continued to grow. 

The retailer reported $36.8bn in sales during the fiscal quarter to the end of October, representing a 9.8% increase compared to the year-ago period. Moreover, big-ticket transactions of more than $1,000 were up 18% year-on-year, giving the company’s net profit margin a big leg up to 11.2%, from 10.2%. 

Considering these figures, I think the company is one of the best US stocks to buy in 2022 as it builds on the growth of the past few years. As we advance, challenges it could face include higher wage costs and other inflationary pressures, which could hurt revenue growth and increase costs. 

Global pharma champion 

Pfizer (NYSE: PFE) is one of the largest pharmaceutical companies in the world. Today, it is best known for its Covid-19 vaccine, which is generating billions in sales for the group. 

But there is far more to this business than its vaccine division. It has a vast portfolio of treatments both on sale and under development, which will add support to the company’s growth in the future.

What’s more, the company should be able to use the profits from its Covid vaccine sales to invest in additional research and development projects. 

Pfizer has plenty of other attractive qualities as well. The group has a robust balance sheet and a dividend yield of 2.6%, at the time of writing. Management has also distributed large amounts of capital to investors in the past with share repurchase. 

Unfortunately, despite these qualities, the company’s success is not guaranteed. It will face challenges, including regulatory headwinds and competition in its drug markets. These could increase costs for the group, reducing profit margins. 

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has recommended Alphabet (A shares). 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.

I don’t know about you but I’m sick of reading (and writing) about coronavirus and its implications for the global economy. But the prospect of a long road out the pandemic is something that share investors like me need to seriously consider.

But there are still plenty of great UK shares I think should thrive irrespective of the public health crisis. So let’s put Covid-19 to one side for a second and keep things cheery.

Here are three such British stocks I’m considering buying this Christmas. Each costs less than £5!

A magical UK share

Harry Potter is the gift that keeps on giving for Bloomsbury Publishing (LSE: BMY). It’s been a quarter of the century since JK Rowling’s boy wizard hit the bookshelves and yet readers remain spellbound by his capers.

This makes Bloomsbury one of the most secure media shares to buy in my book. According to Nielsen, Harry Potter and the Philosopher’s Stone was the fourth highest-selling children’s book in the six months to August.

But Bloomsbury is about much more than Harry Potter. Its foray into academic publishing is also paying off handsomely and sales here soared 32% between March and August.

I think this cheap UK share’s a top buy, even though poor reviews of a new title could have a significant impact upon group sales. Bloomsbury trades at 345p per share right now.

The gaming great

Video game sales have rocketed over the past decade as gaming as a mainstream pastime has taken off. I’ve invested in software development support company Keywords Studios to grab a slice of this action.

And I’m tempted to invest in one of London’s listed games publishers like tinyBuild (LSE: TBLD) too following Keywords’ latest update on Monday. Then it said it was hiking full-year profits forecasts thanks to what it described as a “buoyant” video games market.

Investing in publishers like tinyBuild carries a higher degree of risk than services providers like Keywords. Competition in the games market is intense and smaller publishers like these lack the resources of the mega studios like Electronic Arts and Activision Blizzard to win consumer attention.

But I’m encouraged by tinyBuild’s track record of making highly-popular games such as Hello Neighbor. This tech company trades at 187.5p per share.

A top penny stock I’d buy

As a long-term investor, there’s a lot I like about Hornby (LSE: HRN) shares. Demand its train sets, miniature cars and model kits isn’t likely to explode any time soon. But I love the decades-old appeal that its brands like Corgi, Airfix and Hornby command with hobbyists.

I feel certain they will continue to draw in revenues many years from now. Latest financials showed sales rise 3% in the six months to September.

My main concern with Hornby are supply chain problems that could hit manufacturing and push up costs. That said, I believe the benefits of owning this cheap UK share more than offset the drawbacks. Penny stock Hornby trades at 40p per share.

Royston Wild owns Keywords Studios. The Motley Fool UK has recommended Bloomsbury Publishing and Keywords Studios. 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.

I’m hunting for the best bargain UK shares to buy for 2022. Here are four top, low-cost FTSE 250 shares I’m considering buying today.

Reach for the stars

I reckon Reach could be a shrewd stock to buy in this era of disinformation and so-called fake news. Trusted news brands are worth their weight in gold at this time and the publisher has some of the most popular out there like the Mirror and Express titles. Even though the business faces huge competition I feel these heavyweight brands should stand it in good stead.

This isn’t the only reason I’d buy Reach shares today though.  I also like the rewards that its investment in digital publishing is reaping. Digital sales at the business soared 17.2% between 28 June and 21 November, latest financials showed. At current prices Reach trades on a forward P/E ratio of just 7.2 times.

A premier pick

Premier Foods is a UK share I’d be happy to buy today with a view to holding for the long term. Not only is this business a giant in the ultra-stable food production industry. It owns brands like Paxo stuffing, Mr Kipling cakes and Sharwoods cooking sauces, products that command immense customer loyalty and that enables the firm to raise prices without significant loss of volumes.

It’s true that the food industry is also highly competitive and that Premier Foods isn’t immune to this pressure. However, I think the foodie’s low forward P/E ratio of 10.4 times reflects this earnings threat.

A FTSE 250 stock I already own

I don’t expect 2022 to be a cakewalk for car components manufacturer TI Fluid Systems. Global car production has hit the skids of late thanks to a massive shortage of parts like semiconductors. But at current prices, I still think this FTSE 250 share is worth serious attention. It trades on a forward price-to-earnings growth (PEG) ratio of just 0.2. This is below the benchmark of 1 that suggests a stock is trading below value.

As a long-term investor I think TI Fluid Systems has a lot to offer. The company manufactures in-car technology that carries and stores fluids, the sort of hardware that’s required in great quantities in hybrid and battery-powered vehicles. I expect profits here to soar as sales of green vehicles climb.

Are profits set to fizz?

I also think Britvic shares could be too cheap for me to miss right now. Like Premier Foods, this beverages maker boasts a stable of beloved products like Robinsons, Tango, Lipton and Pepsi Max. Britvic has a long track record of successful innovation with its popular brands too, giving me confidence that it can continue growing profits even in its ultra-competitive industry.

Today the FTSE 250 firm trades on a forward PEG multiple of 0.7. This makes it a great buy in my book, despite the threat that hospitality revenues could sink if Covid-19 lockdowns return.

Royston Wild owns TI Fluid Systems. The Motley Fool UK has recommended Britvic. 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.