Since disposing of Verizon Wireless, Vodafone’s bottom line has fallen and the decision has appeared to have been a mistake. Now, though, Vodafone’s investment in Europe could be about to start paying off, with the company forecast to increase its bottom line by 24% in the current year and by a further 19% next year.

This has the potential to dramatically improve investor sentiment in the stock, although Vodafone’s near-term outlook remains uncertain due to the EU referendum. As such, for long-term investors who can live with a degree of volatility for now, Vodafone could prove to be a sound buy – especially with it yielding 5.4%.

What’s the alternative?

Also offering upbeat growth forecasts is Alternative Networks (LSE: AN), with the IT solutions provider expected to return to growth next year following a difficult 2016 financial year. As stated in its interim results release earlier this month, Alternative Networks is seeing a mixed trading performance, with continued good growth being reported in its Advanced Solutions segment. However, Mobile performance has been negatively impacted by challenging market conditions and a reduction in roaming tariffs implemented by the carriers.

Due to this mixed trading, Alternative Networks is expected to deliver a fall in earnings of 7% in the current year, but is due to bounce back with growth of 13% next year. And with it trading on a price-to-earnings growth (PEG) ratio of just 0.8, its improved performance doesn’t yet appear to have been priced-in by the market. Furthermore, with Alternative Networks yielding 6.3% from a dividend covered 1.4 times by profit, it remains a top-notch income play, too.

One to watch for now

Meanwhile, 2016 has also been a challenging year for investors in Avanti (LSE: AVN). The satellite communication services provider’s share price has slumped by 61% since the turn of the year and short-term jumps in its valuation aside, it has shown little sign of mounting a sustained recovery over a prolonged period.

With Avanti forecast to remain in the red in each of the next two financial years, investor sentiment could continue to weaken. As such, its shares appear to be worth watching, but not buying at the present time. That’s despite the company reporting progress in its most recent update, with it recording a rise in sales of almost 15% in its third quarter. With other technology and telecoms companies offering strong profit growth at a reasonable price, there seem to be a number of better options on offer elsewhere at the present time.

The post Are Vodafone Group plc, Avanti Communications Group plc and Alternative Networks plc 3 super growth stocks? appeared first on The Twelfth Magpie.

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Peter Stephens owns shares of Alternative Networks and Vodafone. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

But there are some opportunities out there. Here are five equities which all support a dividend yield of 5% or more. 

Business overhaul 

Connect (LSE: CNCT) has undergone a huge transformation over the past few years although it looks as if the market remains sceptical about the company’s ability to successfully transform itself into a sustainable distribution business. 

However, as an income investment, Connect ticks all the boxes. The company’s shares currently support a dividend yield of 5.8% and the payout is covered twice by earnings per share — a ratio which gives the company plenty of room for manoeuvre if things don’t go to plan. This year, City analysts expect the company to report a pre-tax profit of £61m, implying that the group will have doubled pre-tax profit in six years. Shares in Connect currently trade at a forward P/E of 8.2. 

Hard times 

Shares in Alternative Networks (LSE: AN) are down by more than a third this after the company warned on trading at the end of February. 

City analysts now expect the company’s earnings per share to decline by 7% for the year ending 30 September 2016, although after this blip analysts have pencilled-in earnings growth of 13% for 2017. Based on these figures, Alternative Networks is trading at a forward P/E of 12.5 and analysts believe the company’s shares will support a yield of 5.7% next year. The payout will be covered one-and-half times by earnings per share. 

Retail troubles 

N Brown (LSE: BWNG) has underperformed this year due to concerns about the quality of the company’s credit portfolio and general retail sector concerns. Still, after recent concerns shares in the company now trade at a relatively attractive forward P/E of 9.9 and support a dividend yield of 6%. The payout is covered 1.7 times by earnings per share. City analysts have pencilled-in a dividend increase of 1% for 2017. 

Unfortunately, when it comes to growth N Brown doesn’t look to overly attractive. City analysts expect the company’s earnings per share to grow by 1% for the year ending 28 February 2017, before ticking higher by 9% for the year after. Over the past five years, N Brown’s pre-tax profit has fallen by £11.1m. 

Housing boom 

Home builder Berkeley (LSE: BKG) is reaping the benefits of the UK’s housing boom and the company is returning the majority of its excess profits to investors. 

Over the past five years the company’s dividend yield has surged from zero to just under £2 per share. This payout equates to a dividend yield of 6.3% at current prices and is covered twice by earnings per share. Shares in Berkeley currently trade at a forward P/E of 12.5. 

Scope to grow

Unlike almost all of its listed retail peers, McColl’s (LSE: MCLS) hasn’t cut its dividend payout recently. The company’s shares currently support a dividend yield of 6.6% and the payout is covered one-and-a-half times by earnings per share. City analysts aren’t expecting the company to increase its per share payout anytime soon. 

So, if you’re looking for a company that has the scope to grow its payout, McColl’s might not be the income play for you. Nonetheless, shares in McColl’s could be too cheap to pass up as they currently trade at a forward P/E of 9.7. 

The post 5 income champions yielding 5%+ appeared first on The Twelfth Magpie.

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Rupert Hargreaves has no position in any shares mentioned. The Motley Fool UK has recommended Berkeley Group Holdings. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

While its Advanced Solutions division delivered growth in recurring revenues and has ended the half year with a strong backlog of non-recurring business, the challenging markets in the company’s Mobile division have persisted. Specifically, the impact of new tariffs on roaming rates has offset further gains in market share, but with cash flow being strong and the overall performance of the business being encouraging, Alternative Networks continues to offer a bright long-term future.

With the company forecast to increase its bottom line by 13% next year, investor sentiment in Alternative Networks could improve. And while it’s experiencing a difficult period, its price-to-earnings-growth (PEG) ratio of 0.8 indicates that there’s a sufficiently wide margin of safety to merit purchase at the present time.

Talk is cheap

Also suffering from a challenging period within the telecoms space is Talktalk (LSE: TALK), with the company not yet fully recovering from the hacking scandal of last year. Clearly, it hurt investor sentiment and Talktalk’s share price hasn’t yet recovered the ground it lost last year, although it has risen by an impressive 14% since the turn of the year.

Although there’s likely to be a significant impact on new customer growth and on customer retention from the hacking scandal, Talktalk’s outlook remains positive. That’s at least partly because it offers a relatively wide margin of safety, with its shares trading on a PEG ratio of just 0.5 at the present time. Certainly, there’s increasing competition within the quad-play space, but with Talktalk having a sound business model and an excellent track record of growth, it seems to be a worthy purchase for the long term.

Fighting back

Meanwhile, Vodafone (LSE: VOD) has also struggled in recent years, with the telecoms major being hurt by a slowdown in the European economy. While this has dragged on its share price performance, Vodafone seems to have excellent growth prospects. For example, it’s expected to increase its earnings by 22% this year and by a further 30% next year.

This appears to be a direct result of Vodafone’s strategy to invest heavily in its network and diversify into new product areas such as pay-TV. Buying undervalued European assets such as Spain’s Ono and Kabel Deutschland also seems to have been a sound long-term move. And although a European downturn could hurt Vodafone’s outlook, its dividend yield of 5% indicates that it offers a sufficiently wide margin of safety to merit investment right now.

And due to its size and scale, it appears to be a better buy than Alternative Networks or Talktalk, although they still offer excellent long-term prospects, too.

The post Is Alternative Networks Plc A Better Buy Than Vodafone Group plc And Talktalk Telecom Group PLC Following Today’s Update? appeared first on The Twelfth Magpie.

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• Here are 2 FTSE shares I’m excited about this July — and 1 I’m avoiding
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Peter Stephens owns shares of Alternative Networks, TalkTalk Telecom Group plc, and Vodafone. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

But a good dividend provider shouldn’t be judged on a short-term hiccup. And in my view, Aviva has dealt with the blow in exemplary fashion by focusing hard on rebuilding its balance sheet. By 2015 results time, chief executive Mark Wilson could say:  “We have completed the fix phase of our transformation,” adding “…our balance sheet is one of the strongest and most resilient in the UK.“

Aviva’s dividend was back up to 20.8p in 2015 for a 4% yield, with rises to 24p and 27p forecast for the next two years — to yield 5.3% and 6% at today’s 447p share price. I see Aviva as a great long-term dividend stock, and with the shares on P/E multiples of only around nine, I see a share price recovery coming too. That combination is why I bought some.

Cash from cash

The payment of bills and services is big business, though highly competitive. But PayPoint (LSE: PAY) has carved a niche as the country’s leading payment collection network — you’ll see its signs at newsagents and stores all over the country, where you can pay bills, and pre-pay mobile and energy meters.

Strong earnings growth resulted in an impressive share price rise until late 2014, but a slowdown (a 7% drop in EPS is forecast for the year to March) has led to a share price fall of 10% over the past 12 months, to 761p. But that’s helped boost the expected dividend yield, with this year’s predicted 42p amounting to 5.6%, and it would rise to 6.4% by 2018 if current forecasts prove accurate. And as PayPoint is a cash-generative company, cover by earnings of around 1.3 to 1.4 times looks safe enough.

On top of that, EPS should start picking up again in the coming year, with the shares’ P/E multiple dropping to 11 by 2018. Is this a smaller cap company that could become a multi-year cash cow? It’s worth a closer look.

Telecoms riches

Looking for even smaller companies, I’m intrigued by Alternative Networks (LSE: AN). It’s a firm with a market cap of around £170m that provides comprehensive communications and IT services to businesses — telephony, network provision, mobile and so on. The share price has been a bit erratic. It dropped sharply in February on a warning over pressures on its mobile business, with profit likely to be impacted for the year to September. At 347p, the shares are down 23% over 12 months, but have managed a 40% rise in five years — not the best in the market, but comfortably ahead of the FTSE 100.

Even with reduced forecasts suggesting a 7% drop in EPS this year, the shares are still on a relatively undemanding P/E of 13, dropping to under 12 on 2017 forecasts. More importantly in my view, with last year’s results the firm reiterated its “intention to progress dividend payments towards 15% annual growth in the medium term, anticipating growth of no less than 10% per annum.” That progressive dividend policy has seen payments rise from 10p in 2011 to 16.4p last year to yield 3.1%, with analysts expecting a boost to 5.4% this year followed by 6.2% in 2017.

The post Are Dividends From Aviva plc, PayPoint plc And Alternative Networks Plc Unbeatable? appeared first on The Twelfth Magpie.

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Alan Oscroft owns shares in Aviva. The Motley Fool UK owns shares of PayPoint. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.