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 Group is strongly capital generative, although this has been impacted by PPI in 2019. Given a strong capital position at the year end, the Lloyds Banking Board has recommended a final ordinary dividend of 2.25 pence per share, bringing the total ordinary dividend for the year to 3.37 pence per share. This represents an increase of 5 per cent on 2018 and is in line with their progressive and sustainable ordinary dividend policy. The Group's capital position remains strong with a pro forma CET1 ratio of 13.8 per cent after allowing for ordinary dividends.Read more
Morgan Sindall announces their total dividend for the year has been increased by 11% to 59.0p per share (FY 2018: 53.0p), which includes a proposed increase in the final dividend of 12% to 38.0p per share (FY 2018: 34.0p), reflecting the improved result in the year, the strong balance sheet and the Board's confidence in the future prospects of the Group. The total dividend per share is 2.7 times covered by adjusted earnings per share.Read more
The BAE Systems Board has recommended a final dividend of 13.8p for a total of 23.2p for the full year. Subject to shareholder approval at the May 2020 Annual General Meeting, the dividend will be paid on 1 June 2020 to holders of ordinary shares registered on 17 April 2020.Read more
The Spectris Board is proposing to pay a final dividend of 43.2 pence per share which, combined with the interim dividend of 21.9 pence, gives a total of 65.1 pence per share for the year, an increase of 6.7%. This is consistent with their policy of making progressive dividend payments based upon affordability and sustainability and represents the 30th year in succession of dividend growth. The dividend will be paid on 22 June 2020 to shareholders on the register at the close of business on 22 May 2020. The ex-dividend date is 26 May 2020.Read more
In line with their policy, the Board is maintaining the interim core dividend at 1.11p per share (2018: 1.11p). The interim dividend payment date will be 9 April 2020 and the ex-dividend date is 5 March 2020 (record date 6 March 2020).Read more
The Smith & Nephew Board has announced they plan to recommend a Final Dividend of 23.1¢ per share (46.2¢ per ADS). Together with an Interim Dividend of 14.4¢ per share (28.8¢ per ADS), this will give a total distribution of 37.5¢ per share (75.0¢ per ADS) for 2019, representing year-on-year growth of 4% in the declared full year dividend. The Final Dividend will be paid on 6 May 2020 to shareholders on the register at the close of business on 3 April 2020.Read more
The MoneySupermarket Board has recommended a final dividend of 8.61 pence per share (2018: 8.10p), making the proposed full-year dividend 11.71 pence per share (2018: 11.05 pence per share) and reflecting their progressive dividend policy. The final dividend will be paid on 14 May 2020 to shareholders on the register on 2 April 2020, subject to approval by shareholders at the Annual General Meeting to be held on 9 May 2020.Read more
Taking into account the performance of the Group's producing assets in 2019 and the outlook for 2020, the Kaz Minerals Board has recommended a final dividend of 8.0 US cents per share. Combined with the interim dividend of 4.0 US cents per share, the dividend in respect of the 2019 financial year is 12.0 US cents per share.Read more
In line with the Anglo American Group's established dividend policy to pay out 40% of underlying earnings, the Board has proposed a dividend of $0.47 per share, bringing the total dividends paid and proposed in respect of 2019 to $1.09 per share (2018: $1.00 per share).Read more
In light of the results for the year, the Rathbone Brothers Board has proposed a final dividend for 2019 of 45.0p. This results in a full year dividend of 70.0p, an increase of 4.0p on 2018 (6.1%). The proposed full year dividend is covered 0.7 times by basic earnings and 1.9 times by underlying earnings.Read more