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Let's be honest, no one can predict the future when it comes to UK stocks, or any stocks for that matter.
However, I can use readily available information to make an informed prediction about which stocks will do well in the future.
Two stocks that I think will do so HSBC (LSE: HSBA) and Michelmersh Brick Holdings share price (LSE: MBH).
I would buy both stocks if I had the cash to invest today. Here is the reason!
HSBC
The Asian-focused banking powerhouse looks like the most attractive banking stock on the FTSE right now.
The £120bn market business has an impressive market position, a strong presence in over 60 countries, and a strong track record. However, I am more interested in the future than the past.
HSBC's access to the lucrative Chinese market is exciting. This region, where wealth levels are expected to grow significantly in the coming years, is one of HSBC's already established presences. Salary and returns can go up, in my opinion.
The obvious danger is the economic crisis. A good example of this has been the recent growth struggles in the region that have hurt the global economy and set many markets back. However, this is a cyclical risk that I am willing to live with when it comes to a bank stock like HSBC.
Continuing my bull case, the shares offer a very attractive dividend yield of over 7%. In context, i FTSE 100 the average is 3.6%. However, I understand that benefits are not guaranteed.
Finally, the shares look very good value for money at a price-to-earnings ratio of just 6.9.
Attractive material, a potentially exciting future, and an established product and business, what's not to love?
Michelmersh Brick Holdings share price
A far cry from the fast-moving world of financial services is Michelmersh Brick Holdings – a business in the business of creating and selling bricks, tiles, and other construction projects.
Michelmersh may not have the brand name and power that HSBC does, but it has a lot going for it. First, it produces its own products, which can help with pricing and operating costs.
From a future perspective, demand for bricks and building blocks is set to increase, particularly in the UK. Housing inequality, and the need to build infrastructure for the UK's growing population may affect Michelmersh's income and increase.
Speaking of returns, the 4.7% dividend yield is attractive. Furthermore, the shares look good value for money at a price-to-earnings ratio of just 11.
Michelmersh risks economic instability from several different sources. The new government has talked about a financial black hole, which means infrastructure projects are being put on hold. Another issue is inflation, which may hamper profits, and demand. These factors can affect earnings and returns, as well as growth.
Overall, I think Michelmersh is an under-the-radar gem, compared to the established names that operate in the so-called glamor industry.
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