Dividend of the week - ITV
This week we are going to use DividendMax to go for decent growth stocks paying a pretty good dividend. These are obviously fairly difficult to find as the two tend not to go hand in hand, so we will set our annualised dividend level at 3%, which is fair play given the income alternatives out there. We set our market cap at over £1 billion and dividend cover greater than 3. Our forecast dividend increase is at least 20%.
This yields 1 very large stock in Rio Tinto with a market cap of over £50 billion, so hardly a candidate for high growth, but it could be a candidate recovery stock if commodities rise. However, it will not be the dividend of the week. The remaining selections are Evraz, GKN, African Barrick Gold, ITV, Travis Perkins and Smith & Nephew. Evraz looks like a far better recovery play than Rio, but the dividend forecasts are very wide.
The average analysts dividend forecasts for Evraz on digital look for 2012 are below what they have already paid out at the interim stage suggesting that they are going to ask shareholders for money back at the finals stage! I suspect the owners of Evraz will want dividends, ergo I believe dividend forecasts are far too low. I cannot recommend African Barrick as it is in the middle of a protracted takeover. GKN sits at the top its trading range and upside is limited; As does Travis Perkins. Smith & Nephew looks fully priced at the current level, which leaves ITV.
It is my belief that ITV is a sleeping giant. Formed from the merger of Carlton Communications and Granada, both formerly very large companies in their own right. We have seen the start of a recovery that has some way to go and this will be backed by strong increases in the dividend. Under the strong management of Adam Crozier, the company is about to complete year 3 of a 5 year transformation plan.
This, in itself should guarantee momentum. Throw into the mix economic recovery in two to three years time and we are potentially looking at a company that could outperform the market consistently over a sustained period of time. With ITV achieving it’s first net cash position since it’s inception in 2004 at the last financial year end, there is money to drive growth (and dividends).
At the time of the November Interim Management Statement, net cash stood at £90 million. It does stand near its 12 month high, but in this case long term sustained growth is to be reasonably expected. Analysts forecasts look undemanding. ITV gets the nod over Evraz for dividend of the week.
The Smiths Group Board maintains a progressive dividend policy, aiming to increase dividends in line with long-term underlying growth in earnings and cash-flow. The policy enables them to retain sufficient cash-flow to finance investment in the drivers of growth and meet financial obligations. In setting the level of dividend payments, the Board considers prevailing economic conditions and future investment plans, along with the objective to maintain minimum dividend cover* of around 2 times.Read more
The Hansard Board has proposed a final dividend of 2.65p per share, the same level as last year. In making this proposal, the Board has carefully considered its current financial position and future outcomes under a range of plausible adverse scenarios taking into account Covid-19.Read more
The PZ Cussons Board is recommending a final dividend of 3.13p (2019: 5.61p) per share, making a total dividend for the year of 5.80p (2019: 8.28p) per share. The gross amount for the proposed final dividend is £13.1 million (2019: £23.5 million).Read more
On 2 April 2020 the board announced that it had decided to cancel the 2020 interim dividend, which would have been paid on 22 April 2020, recognising the significant challenges faced by businesses and individuals and consistent with the purpose of helping the people and businesses of Britain.Read more
The Alliance Pharma board have announced that, after suspending the final dividend payment for 2019 in response to the COVID-19 pandemic, it is declaring an interim dividend payment of 0.536p per share for 2020, in line with that for 2019. The Board will continue to assess the level of future cash distributions having regard to overall business performance and future outlook, in light of the global uncertainty created by COVID-19Read more
The North American Income Trust revenue return per Ordinary share rose by 27.0% from 5.35p to 6.80p. The Board has declared a second quarterly dividend of 1.8p per share, giving total dividends for the first half of the year to 31 January 2021 of 3.6p (2020 - 3.4p), a 5.9% increase. The second quarterly dividend is payable on 30 October 2020 to shareholders on the register on 2 October 2020.Read more
The Brooks Macdonald Board has recommended a final dividend of 32.0p (FY19: 32.0p) which, subject to approval by shareholders at the AGM, will result in total dividends for the year of 53.0p (FY19: 51.0p). This represents an increase of 3.9% on the previous year and reaffirms the Board's confidence in the strength of the business even in the context of the COVID-19 pandemic, and a commitment to a progressive dividend policy. The final dividend will be paid on 6 November 2020 to shareholders on the register at the close of business on 25 September 2020.Read more
The Clinigen Directors are proposing to increase the final dividend to 5.46p per share (2019: 4.75p), resulting in a 14% increase in the full year dividend to 7.61p per share (2019: 6.7p).Read more
The Hilton Food Directors have approved the payment of an interim dividend of 7.0p per share payable on 27 November 2020 to shareholders who are on the register at 30 October 2020. This interim dividend, amounting to £5.7m has not been recognised as a liability in these interim financial statements. It will be recognised in shareholders' equity in the 53 weeks to 3 January 2021.Read more
The LXI Board has declared today an interim quarterly dividend in respect of the quarter ended 30 June 2020 of 1.30 pence per ordinary share, in line with the previous quarterly dividend guidance issued in May 2020.Read more