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Although the Budget on 30 October may be painful, it will not shake my commitment to investing for the long term. But there are some UK stocks I avoid like the plague, at least based on current form.
Aston Martin Lagonda
I can't deny that the idea of owning a part of the world's best car manufacturer is attractive. Look under the bonnet, though, too Aston Martin Lagonda (LSE: AML) slaps an old banger. Its shares have lost 97% of their value in six years, making it one of the worst listings in recent memory.
To be fair, the FTSE 250-The listed business has faced major storms. Supply chain problems and high inflation conspired to reduce sales. By normalizing the latest and the new Win V12 due before the end of 2024, perhaps a recovery is on the cards. Even a small chink of light could see the share price rise. The Q3 update is due tomorrow (October 30).
But I think we still have a lot to worry about. A quick profit for CEOs is not guaranteed. There are also a number of debts to consider. This raises the possibility that a loss-making company will take its long-suffering investors for cash (again).
Did I mention it has exploded seven times before? If that's not a bad omen, I don't know what is.
Ocado
I avoid Ocado (LSE: OCDO) for similar reasons.
Also, I can't deny that the 'product' is amazing. The company's customer fulfillment centers (CFCs) are a sight to behold, with robots zipping around to fill customer orders.
The problem is that the company is worth £3bn. That's a lot of money for something that still isn't profitable. It also means that dividends, if they ever come, are years away.
And, maybe there are better times ahead. Revenues have been increasing (and losses have been decreasing) through 2024. There are signs that Ocado will have cash flow in FY26.
But I'm not sure I have the stomach or the patience to wait for the company to fulfill its relationships with different stores.
At the moment, the balance sheet is as shaky as a storied house and all that high-tech wizardry isn't going to be cheap to maintain.
boohoo
The last assignment that gives me the heebie-jeebies is a fast fashion firm boohoo (LSE: BOO).
To be fair, I've actually owned the stock a few times over the years, albeit with varying degrees of success. I was initially attracted to the company because of its marketing know-how, strong financial position and growth prospects (enhanced by the acquisition of several products such as Debenhams)
Since then, boohoo has fallen significantly in my estimation, and, it seems, its demographics. Business management in doubt? Check it out. Declining profits? Check out. Chinese rival Shein also grabbed market share.
This month, chief executive John Lyttle said he was stepping down. Now, Group of Frasers founder Mike Ashley wants the job to prevent further destruction of value. Everything is covered in blood.
Perhaps the company may surprise us as discretionary spending recovers. Half-year numbers are due on Friday (November 1).
But I won't get involved. Sleepless nights are not what I want.
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