3 top UK shares to buy in September 2021

A man opens a car boot

With traders coming back from holiday, I expect that September could be a lively month in the stock market. I’ve been considering what UK shares I might add to my portfolio this month. Here are three I would consider.

Quality on sale

Even if you’re not familiar with household goods maker Reckitt (LSE: RKT), you probably recognise its brands such as Dettol and Lysol. But while its portfolio may help consumers clean their homes, it hasn’t helped shareholders clean up lately. Over the past year, Reckitt shares have fallen 21%.

That is due to a combination of factors. The company’s ill-starred infant formula division continues to struggle. The boom in demand for cleaning products during the pandemic has led to ingredient inflation. If it can’t pass that on to its customers in the form of price rises, Reckitt’s profits could tumble. These risks remain, and help explain the weakened price of this UK stock.

Taking a longer-term view, though, I see reasons to be cheerful about the company. Its powerful portfolio of premium brands give it pricing power. It has global reach, helping it benefit from rising demand in many developing markets. I also think its cleaning portfolio will see a sustained boost from the pandemic. Even if demand drops off a bit, I don’t expect it to fall back to where it was a couple of years ago. Given their relative underperformance to the wider market lately, I would consider adding Reckitt to my portfolio.

UK shares to buy: WPP

A company whose shares have performed much better in the past year than Reckitt is advertising group WPP. It operates through a large number of well-known agencies. Advertising demand has been booming. The WPP share price has moved up an impressive 60% over the past year.

Given its strong progress lately, why do I see further upside potential in the WPP share price? In short, I think the group has more left to achieve in turning around its business. If it can demonstrate continued success in that, the share price will hopefully rise to reflect it. Previously, analysts have doubted the ongoing relevance of the WPP model in an increasingly digital advertising environment. The company has reacted to this and is starting to show the benefits of its refocus. However, the turnaround is far from complete and there remains a risk that nimbler digital competitors could eat into WPP’s revenue if it doesn’t stay the course in its transformation.

Oil giant

Energy company BP has ambitious plans to make alternative energy a larger part of its future footprint. They have elicited mixed reactions and recent oil price falls haven’t helped the BP share price. But with a 5% dividend yield, I would consider adding some of these to my portfolio of UK shares now.

Risks remain with both an uncertain oil price and the shift to a different business mix threatening the company’s revenues.  But with an attractive yield and strong asset base, I am bullish on BP at the current share price.

The post 3 top UK shares to buy in September 2021 appeared first on The Motley Fool UK.

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Christopher Ruane 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.