2 cheap shares investors can still grab

A new bear market quickly became the news yesterday. And cheap stocks are getting harder to find on the London stock market.

However, there are still some tempting opportunities out there. And I want to catch some because I believe that this bull run has legs now.

One thing that has been proven in difficult economic and geopolitical times is the resilience and adaptability of many businesses. And I want to put the money into UK shares which I will now hold for the long term.

Technology for gaming

For example, I like to think from Playtech (LSE: PTEC). The company provides technology for the online gaming software industry.

In September with its half-year report, the business delivered a performance ahead of directors’ expectations. And the momentum continued into the second half.

Chief executive Mor Weizer said Playtech is “is well placed to take advantage of the exciting market opportunities ahead.” And part of the strategy involved simplifying the business to focus its efforts on “tall growth” business-to-business (B2B) and business-to-consumer (B2C) gambling markets. The year-end disposal of the company’s Finalto business is a “important step” to that destination.

Meanwhile, City analysts expect earnings to grow by around 9% this year. And with the share price close to 542p, the expected earnings multiple is more than 10.

To me, the price seems attractive. And I consider the stock to be long-term to see if the company can grow as it embarks on a new strategic direction. However, there is a lot of debt on the balance sheet to watch out for. And shareholder dividend yield is low.

You should also remember that the company’s financial history is not clear. So I will be looking for new growth to emerge and increase the numbers going forward. However, positive results are not certain.

Parts for trucks

Another thing I see is Casting (LSE: CGS), an iron casting and machinery company that makes many items for heavy truck manufacturers.

The November half-year report produced some impressive year-on-year figures. And the company says demand for heavy trucks has been strong. Indeed, there is an improvement in it “Conversion of forward schedule into actual sales” compared to the previous year.

Going forward, the outlook statement is bullish. And City analysts expect earnings in the current trading year to March 2023 to rise by around 45%. However, the forecast for the next year is only a 4% increase, or so.

But I think the price seems modest. With the share price close to 355p, the expected price-to-earnings ratio is about 12. And the anticipated dividend yield is close to 4.8%. But on top of that, the business has a long track record of running a strong looking balance sheet net cash position.

However, this is a very cyclical business. So long-term investing in stocks now requires me to return to my bullish view of the general economy. And that situation has its own risks.

However, I am interested in both stocks and would be inclined to invest if I had spare cash.