2 promising British value stocks to consider for a Stocks and Shares ISA next year

Things have been a bit stagnant FTSE 100 recently, the index is down about 3% in the past month. Now, I’m looking further into the lesser known but promising UK stocks for my Stocks and Shares ISA next year.

I often find when times are tough, the little guys come out of the woods and start to shine.

Here are two that I think could enjoy good growth in the coming years – if the economy plays ball!

A train line

A train line (LSE: TRN) is a digital ticket booking service that has recently gone from strength to strength. The share price has risen by an impressive 41.5% in the past year. Not bad for what it really is a train and coach comparison site, helping users find the cheapest or most timely journeys anywhere in the EU.

I remember when it was a small UK train booking site called thetrainline.com. It was renamed Trainline in 2016 before expanding across Europe and going public in 2019. Things were a little rocky at first but in recent years it seems to have found its feet (or rails).

The company now boasts a £1.85bn market cap and revenues of £114.5m as of August this year. It has a strong dividend yield of 14.8% and earnings per share (EPS) which is up 300% year over year.

On the other hand, the high price means it also has a high price-earnings (P/E) ratio of 32.8 – well ahead of the industry average of 22.8. That makes further growth less likely. Other risks that threaten profitability include restrictions on travel and competing applications, especially on low-cost routes such as budget airlines. On average, traveling by train is always more expensive compared to short-haul flights.

Still, recent performance suggests it must be doing something right, so it’s on my list of ISA picks for 2025.

XPS Pensions Group

XPS Pensions Group (LSE: XPS) is a British pensions firm that provides a range of services focusing on pensions, investment consultancy and management.

The main reason I like it is the slow but steady growth. I am a big fan of investments that I can forget about for years without worry. It also has a yield of 2.8% – although it has only recently started paying dividends so the reliability is not yet certain.

The second reason I like it is a strong balance sheet, with low debt and adequate interest. It has a high profit margin of 27.2% and a high return on equity (ROE) of 29.1%. Also, at 14.5, its P/E ratio has fallen for a long time.

However, something that happened recently worries me. CEO and Director Ben Bramhall recently sold 51% of his shares below the current price. It’s impossible to say exactly why – maybe he needed the money – but it’s dangerous nonetheless. When an insider sells, we have to wonder if they know something we don’t!

Looking ahead, revenue is forecast to grow by 12% over the next year while earnings are forecast to decline by around 10%. This will not affect the share price but can limit growth.

With steady growth and a good dividend yield, I’m happy to put it on my list of possible ISA additions next year.