Personally, I think things might get worse before they get better. With this in mind, here are three stocks from lower down the market spectrum that I think are definitely worth paying attention to next month.  

Hot stock

First up is infection prevention product supplier Tristel (LSE: TSTL). For fairly obvious reasons, this is a company that has received a lot of attention from investors recently. And despite slipping back in recent weeks, its stock is still up 46% since March’s nadir.

Tristel is a company I’ve coveted for a while. The only problem is that its shares have long felt very expensive. Right now, for example, they change hands for 38 times earnings. That’s punchy when the future looks so uncertain, even for a company in a ‘hot’ space. 

But if there is a significant second wave, the shares could be one of the few winners. If, however, there’s a mass market crash for more economic reasons, some of the recent gains could be lost. 

I’ll definitely be checking out the firm’s latest trading update on 22 July.

Lockdown winner

A second small-cap reporting in July is one I’ve hitherto avoided like the plague: online electrical retailer AO World (LSE: AO). More fool me. The shares are up almost 200% since March’s market crash.

As you might expect, AO has been a huge beneficiary of the lockdown with more people needing tech to work and shop from home. Earlier this month, it spoke of having grown market share and seeing “increased demand and sales across all categories”. The question now is whether the shares can extend their gains or everything is fully priced-in? I’m inclined to think the latter.

As much as it’s made money for opportunistic investors in recent times, I just can’t get excited about a business operating in such a competitive sector. When demand is massive, even loss-making firms (such as this one) can do well. What happens, however, when supply chains at larger rivals get back to normal?

Still, good luck to those already holding. For those who aren’t and fancy a (very-un-Foolish) dabble, I suggest only doing so with money you won’t miss. 

AO is down to report to the market on 14 July.

Calm before the storm

My third pick of shares worth watching in July is an old favourite: insolvency specialist Begbies Traynor (LSE: BEG). If any stock is a compelling counter-cyclical candidate at the current time, this must surely be it. 

Last month, Begbies reported that it continues to trade well “with strong growth in revenue and profit compared to the prior year“. With many businesses still shut, I suspect this situation won’t have changed by the time the company reports full-year figures on 21 July.

But forget the last few months — I think the firm might be flooded with business in the rest of 2020. And even if it takes some time for this to be reflected in the share price (particularly if there’s a second market crash), there will be dividends to collect in the meantime. 

Begbies trades at almost 16 times earnings and yields a forecast 3.2% for FY21.

The post Fear market crash 2.0? Watch out for these small-cap stocks in July appeared first on The Twelfth Magpie.

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Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Is there any way for Foolish investors to come out on top? I think so. Today, I’m taking a closer look at two companies that could offer great protection from the looming fallout.

Recession-proof

Small-cap Begbies Traynor (LSE: BEG) is a company I’ve been positive on for quite some time. The £140m-cap is a property services consultant and insolvency specialist — the latter a service that, sadly, looks likely to experience greater demand as the recession hits. Indeed, today’s trading update was indicative of what’s likely to come.

Revenue for the financial year to the end of April is now expected to be around £70m — up from just over £60m in 2018/19.

Profits at its business recovery and financial advisory division were a highlight. They grew roughly 30% over the year as more firms faced insolvency, even before the pandemic struck. Recent acquisitions and higher average fee levels also provided a boost.

All told, adjusted pre-tax profit is likely to come in at £9.2m, up from £7m in 2019. The firm did say, however, this included a £600,000 hit after several of its property service lines were hit by the lockdown. 

Positive outlook

Begbies was trading 3% lower this morning, suggesting some traders were banking profits. The stock was, after all, up a stonking 77% since 23 March.

Today’s move aside, I still think the company could be a rare winner in the recession. While the full impact of the coronavirus is unknown, Begbies is expecting “progressive increases in the number of insolvencies” as we move through 2020. This could be compounded, of course, by Brexit.

In addition to this ‘positive’ outlook, Begbies finances look increasingly sound. Net debt stood at £2.8m at the end of April, down significantly from £6m in 2019. The firm had £7.2m in cash last month and undrawn borrowing facilities of £15m.

There’s good news for income seekers too. Having already paid its interim dividend this month, Begbies said it was intending to confirm a final dividend in July. 

Trading on 16 times forecast earnings before markets opened, the stock isn’t screamingly cheap. It could, however, be a great counter-cyclical, recession-beating pick.

Profits “ahead of expectations”

Begbies isn’t the only option for investors in this space. New-stock-on-the-block FRP Advisory (LSE: FRP) could be a great alternative. Larger than its peer Begbies, the company also supports businesses facing insolvency. 

Unsurprisingly, demand for its services has been just as good. In its recent update, FRP said it had “traded strongly” in the second half of its financial year. Revenue will likely to come in at £31.8m with profits “ahead of the Board’s expectations.” For the full 12 months, £63.2m of revenue has been predicted — a rise of 16.4% on the previous 12 months. 

Like Begbies, FRP looks financially sound (and you would hope so!). Like Begbies, the company also expects to pay a final dividend. 

Having only listed in March, the minnow looks to be flying under analyst radars. I expect this to change markedly in the coming months as the recession takes hold. I think those buying this defensive stock now could see great returns in time.

The post Don’t fear the recession. I’d buy these defensive stocks to come out on top appeared first on The Twelfth Magpie.

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• Forget meal deals! Here’s how £8 a day could be worth £357,000
• Up 132% and surging, how is this FTSE 250 share STILL so cheap?

Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

That’s not to say there aren’t any great stocks available for those willing to look at the lower end of the market spectrum. That’s particularly so for patient dividend investors. 

Hot stock

While clearly not taking into account trading during the coronavirus outbreak, today’s full-year results from Strix (LSE: KETL) demonstrate how solid it is. The company is a kettle safety control designer, manufacturer and supplier and also produces water filtration products.

Revenue climbed 3.3% to £96.9m in 2019. And the AIM-listed firm continued to boast huge market shares in regulated (73%) and less regulated markets (34%). Pre-tax profit moved 3.4% higher to £30.2m, in line with market expectations. 

Away from the headline numbers, it’s pleasing to see that Strix continues to improve the health of its balance sheet.

It saw investments such as the building of a new factory in China and the acquisition of assets from clean water business HaloSource. But its net debt was still cut to £26.3m, a roughly 4% improvement from the end of 2018.  

Regarding the coronavirus, CEO Mark Bartlett said the small-cap’s manufacturing operations in China had improved. He said they had “recovered with a c.100% production capacity and operational supply chain which is sufficient to meet customer demand”. That should be hugely reassuring for those (like me) already holding the stock. 

As a further sign of confidence in its outlook, Strix stated that it would propose a final dividend of 5.1p. This would bring the total cash return for 2019 to 7.7p per share, a 10% increase on 2018’s payout and covered healthily by profits. Taking today’s share price rise into account, that gives a trailing yield of 6%. Hikes to the cash returns also look likely in the future.

Taking all this into account (and allowing for some bias), I continue to think Strix is an excellent income stock to tuck away for the long term. In fact, it looks something of a steal given a valuation of just 8 times forecast earnings!

Counter-cyclical

Another minnow boasting defensive qualities and a decent dividend yield is insolvency specialist Begbies Traynor (LSE: BEG).

Considering the impact the current crisis is likely to have on UK plc, I suspect the Manchester-based business could be one of few to see an increase in trading over the next few months. Given that the £95m cap remarked that it was already confident of reporting results “at least in line with expectations for the year as a whole” only a couple of weeks ago, that bodes very well for existing investors. 

Aside from the potential for capital gains, the small-cap could also be a good source of dividends. If we assume that the analyst predictions are correct, the firm will return 2.8p per share in this financial year (ending 30 April). That translates to a yield of 3.7%.

Stock in Begbies was changing hands for 13 times earnings before this morning. Although there can be no guarantees, that could turn out to be a very reasonable price to pay once the full extent of the damage wrought by the virus becomes clear.

The post I think these cheap small-cap dividend stocks are cracking buys in this market crash appeared first on The Twelfth Magpie.

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• Up 132% and surging, how is this FTSE 250 share STILL so cheap?

Paul Summers owns shares of Strix Group. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Having said this, not every company’s share price will necessarily suffer as a result of the coronavirus outbreak or other global fears. Here are three that could prove resilient. 

“Trending substantially ahead”

Companies operating in the spread betting/Contracts for Difference space are worth watching. Today, one of the three listed on the London market — Plus 500 (LSE: PLUS) — issued a positive update. Yes, you read that right.

As a result of the fear that’s spread throughout the investing world over the last few days, the FTSE 250 constituent stated that it had seen “a significant increase in levels of customer trading activity” before going on to say that its financial performance over Q1 is“trending substantially ahead” of the same period last year. You’re not seeing language like that from many companies at the moment!

Of course, no one knows if this momentum will last. That said, Plus’s shares were trading on what appeared to be a very cheap forecast price-to-earnings (P/E) ratio of a little under 9 before markets opened this morning and yielding 5.8%. It’s next scheduled to report to the market in April. 

Downturn play

With Bank of England Governor Mark Carney warning that disruption to supply chains could mean a hit to UK growth prospects, it’s understandable if many businesses are getting nervous. Should a prolonged downturn come to pass, one company that may benefit is insolvency specialist Begbies Traynor (LSE: BEG).

Even if you’re confident that the coronavirus outbreak won’t bring the economy to its knees, there’s always the impact of troublesome Brexit negotiations to ponder. Back in January, the company released research showing that just under half a million UK businesses were already in ” significant distress” — a rise of 81% since the beginning of 2016 (the same year as the EU referendum).

Despite this, shares in Begbies certainly haven’t been immune to the recent sell-off and have now fallen back to prices not seen since last spring. This leaves them trading at 13 times earnings. A potential 2.8p dividend in the current financial year has the stock yielding 4.2%.

Stable demand

Call up a chart of its share price performance over the last week and you’ll see why funeral services provider Dignity (LSE: DTY) is the final pick of today’s shares that could protect your portfolio from the current crisis. Its price is currently up 4% since Monday, supposedly on the belief that demand for its what it does will remain stable, even during tough economic times. 

As always, there’s no sure thing when it comes to investing and Dignity could become another victim of the sell-off in time. That said, the fact that it was already trading on a little less than 9 times forecast earnings could mean it suffers less severe selling pressure than other, more highly-rated stocks. 

Regardless of what happens next, it’s worth being aware that the company has faced increased competition over the last few years. The shed-load of debt on the balance sheet is another potential red flag. Last year, the latter came in at almost twice the value of the whole company!

The post Fear this crash could get worse? Here are 3 stocks I think could hold their own! appeared first on The Twelfth Magpie.

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Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Exiting the European Union without an agreement would be the meteorite that smashes the political landscape in the UK to smithereens and puts the domestic economy in severe long-term jeopardy, and for this reason I’ve stuck to my guns in recent months and talked down the chance of a disorderly Brexit actually transpiring.

I still believe that leaving the European bloc under a ‘no-deal’ scenario is the least likely outcome, but only marginally so now.

The Westminster stalemate is unlike anything we’ve seen in peacetime and it doesn’t appear set to be resolved any time soon. In fact, the chances of us slipping out without a deal on 11pm on Friday, March 29 have increased in recent days, first through speaker John  Bercow’s decision to stop Meaningful Vote III happening, and increasingly-frosty rhetoric from many of the EU’s other 27 states on the prospect of any sort of Article 50 extension.

A Brexit beneficiary

There’s still a long way to go in the days ahead, but with the situation as cloudy as ever, nothing can be presumed. I think it’s safe to say that either an extension to Article 50 or a disorderly Brexit are the only games in town, though, and thus the uncertainty that’s proving increasingly problematic for the UK economy is set to last for some time yet, whatever happens from here.

For this reason I think that buying up Begbies Traynor Group (LSE: BEG) may be a wise bet. The corporate insolvency specialist is already thriving in this environment and there’s little reason to expect it to change.

Full quarterly financials from the AIM-quoted firm saw it citing Insolvency Service data showing the number of corporate insolvencies soaring to 16,090 in 2018, up 10% year-on-year as uncertainty over Brexit smacked business. To put this into context, this represents one in every 242 companies experiencing severe financial distress. It’s no surprise then that Begbies Traynor said that it has experienced “revenue and profit growth for the year to date.” 

Big dividends

It should also come as hardly a shock that City analysts expect profits growth at the business to go from strength to strength, reflecting these fertile trading conditions as well as the firm’s rich appetite for acquisitions. A 12% earnings rise is predicted for the 12 months to April 2019, a projection that improves to 16% for the following fiscal period.

And these bright projections give plenty of other reason to celebrate. Firstly they make Bergbies Traynor a bargain at current prices, the firm carrying a dirt-cheap forward P/E ratio of 13.4 times. Secondly, they mean that City analysts are anticipating more dividend growth, from the 2.4p per share reward of last year to 2.6p this year and 2.8p in fiscal 2020. Such figures yield a fatty 4.3% and 4.6% and make the business a great income share to buy, in my opinion, and particularly for those who are especially fearful over Brexit.

The post 10 days to go! I think Brexit could help this mega-cheap dividend stock to surge appeared first on The Twelfth Magpie.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

But as I explained in a recent article, there’s no shortage of exceptional income stocks from outside the Footsie that could help you to make a fortune. In this article, I’m looking at some of the lesser-known big yielders that may boost your investment income.

Revenues are soaring

I’m not one to relish in others’ misfortunes but now could be a great time to pile into insolvency expert Begbies Traynor Group (LSE: BEG).

The British economy is listing and this AIM-quoted business is reaping the rewards of this fertile environment and revenues are rising at quite a pace. I’m not expecting demand for its services to die back either as, whatever Brexit path the country follows, some economic turbulence can be expected at least in the short-to-medium term.

I’m also encouraged by Begbies Traynor’s steps to build long-term growth through acquisitions. This month alone, its snapped up two businesses to bolster its operations, first with the takeover of transport-advice specialist Croft Transport Planning & Design, and then the purchase of insolvency practice KRE (North East) Limited.

City analysts are predicting strong earnings growth through the next couple of years and meaty dividend increases, too. This means that payout yields sit at an enormous 4.1% and 4.5% for this fiscal year and next, respectively.

Build a fortune

Another big yielder from the AIM market to sink your teeth into is Springfield Properties (LSE: SPR), the construction colossus sporting big figures of 3.7% for this year and 4.4% for the following year.

Time and again, I’ve lauded the Scottish housebuilder’s investment prospects thanks to the UK’s enormous homes shortage that’s keeping its newbuilds well bought. It’s a phenomenon that is powering profits steadily higher across the housing sector, and one that’s likely to remain in place for a long time yet given the lack of serious government inaction to ratchet up building rates.

In the immediate term too, the favourable lending environment is helping to keep homebuyer demand on the boil, and I’m not expecting this support to ebb away given the intensifying mortgage rate war being fought by Britain’s lenders. And this leads City brokers to predict that Springfield’s annual earnings should keep growing by double-digit percentages at least for the next few years.

An added bonus with both Begbies Traynor and Springfield Properties as that both firms sport very-appealing valuations right now, i.e. forward P/E ratios of just 7.5 times and 9.4 times, respectively. This is a snip given these secret investment stars’ potential to deliver brilliant earnings and dividend growth now and for many years into the future. I reckon they’re both great stocks to load up on right now.

The post Calling income investors! Should you ignore the FTSE 100 and buy these unknown dividend stocks instead? appeared first on The Twelfth Magpie.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Headlam Group (LSE: HEAD) is a big-dividend-paying small-cap that may not be for the faint of heart, but I’m convinced it still has what it takes to deliver titanic returns now and in the years ahead.

Brexit is wreaking no little havoc on trading at the floor coverings specialist right now, prompting it to predict in its recent pre-close update that “the UK market will show further general weakness during 2019.” Despite this, Headlam predicted that group revenues will remain flat this year, and I’m inclined to believe it given its ability to perform in already-tough conditions — it advised in this month’s statement that profits were “marginally ahead” in 2018 despite troubles in its home market.

Headlam may well experience some forecast-denting turbulence this year — a 4% earnings rise is currently anticipated by City brokers — but I believe the chances of this occurring are baked into the firm’s low forward P/E ratio of 9 times. I’m far more attracted by its bulging 6.7% dividend yield, and the brilliant long-term profits opportunities created by its expansion strategy in Europe.

Strike it rich

Bowling alley operator Ten Entertainment Group (LSE: TEN) is another income giant carrying inflation-mashing dividend yields in the near term, in this case a reading of 5.3%.

And just like Headlam, the ten-pin titan can also be picked up for next to nothing, the small-cap also carrying a mega-cheap prospective earnings multiple of 11.4 times. This also doesn’t factor in the resilience of this little-known income hero, in my opinion, the resurgent appetite for bowling in Britain helping it to overcome increasing pressure on consumer spending power as well as the impact of “extreme” summer weather.

Earlier this month Ten Entertainment said that like-for-like sales rose 2.7% in 2018, the seventh successive year of growth. And the business looks good to continue growing profits at a breakneck pace, helped by its ongoing acquisition drive. The City certainly thinks so, with analysts forecasting a 22% earnings rise in 2019.

Don’t miss this dividend star!

Corporate insolvency specialist Begbies Traynor Group (LSE: BEG) may have seen its share price clatter lower in recent months, but I am convinced this represents a prime dip-buying opportunity.

Why? Well, as the British economy slows the number of businesses experiencing financial distress is growing, and this is playing into the likes of Begbies Traynor’s hands. It saw revenues rise 8% in the six months to October, to £28m, and with debt falling the AIM business is in great shape to execute more earnings-enhancing acquisitions, not to mention to keep lifting dividends.

Indeed, City boffins predict a full-year dividend of 2.6p for the period to April 2019, up from 2.4p last year and yielding a formidable 4.5%, aided by an anticipated 9% earnings rise. Combined with a low, low forward P/E ratio of 13.1 times I reckon Begbies Traynor is a great income share to pick up today.

The post These 3 ‘hidden’ dividend stocks yield up to 6.7%. Can you afford to ignore these bargains? appeared first on The Twelfth Magpie.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

With this in mind, here are a couple of companies that I think could do better than most if the economy does experience problems going forward, one of which reported to the market earlier today.  

Primed for growth?

Given its market capitalisation of just £76m, it’s to be expected that the majority of retail investors probably won’t have heard of Begbies Traynor (LSE: BEG). I think this could be set to change over the next year.

The market minnow has been around for almost 30 years and describes itself as “the UK’s leading corporate rescue and recovery practice“. In other words, it works with companies facing financial challenges — something that could increase substantially if Brexit proves the nightmare some are predicting.

For now, however, things are moving along fairly nicely. Revenue rose by £2m to £28m in the six months to the end of October with adjusted pre-tax profit also climbing by a little over 10% to £3.2m. This was, according to the company, “ahead of a strong comparative period” and the result of an increase in the number of new insolvency appointments and previous organic investments. 

In addition to a 14% increase to the interim dividend, the Manchester-based business also announced that net debt had fallen by a little under 9% to £6.3m by the end of the reporting period. 

Looking to the full-year, Begbies stated that it was well placed to meet current expectations, although results would be second-half-weighted. 

On almost 16 times earnings for 2018/19, the stock isn’t exactly cheap, especially at a time when markets continue to look susceptible to further falls. Nevertheless, for the potential growth on offer, I think this can be justified. I own a small amount of the stock and plan on retaining it so for some time to come. 

Discount demon

Another stock that I think might be worth holding if tougher times lie ahead is FTSE 250 retailer B&M European Value Retail SA (LSE: BME). That might seem odd when the rest of the industry is on its knees, but hear me out. 

If an economic downturn really is on the way, people won’t stop spending completely. Instead, they’ll likely head towards retailers that give them more for their cash. In such a situation, B&M will surely be able to benefit from the economies of scale that befit its near-£3bn market cap and offer exactly the sort of generic goods people want when funds are tight. That’s what happened with discounters in the aftermath of the financial crisis and we can be fairly confident that it will happen again. 

That’s not to say that B&M has been immune to the sell-off in the markets over the last couple of months. In early November, the stock hit 426p a pop. Today, the very same shares can be yours for 33% less. This leaves them trading on 14 times forecast earnings (and offering a secure yield of 2.9%). 

While clearly nowhere near as cheap as some retailers — particularly those in the clothing industry such as Superdry, Marks and Spencer and Quiz — again, I feel that this relatively high price can be justified.

The post Bothered by Brexit? I think this secret small-cap stock could be worth holding in 2019 appeared first on The Twelfth Magpie.

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Paul Summers owns shares in Begbies Traynor Group. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

The newsagent struck its cheapest price for 15 months in recent sessions. And the scale of the downward spiral is quite flabbergasting, given the robust trading statement the FTSE 250 firm had issued just prior to October’s decline, in which it again highlighted the potential of its Travel arm.

Indeed, City analysts juiced up their earnings forecasts following the release and they are now predicting an 18% bottom-line rise in the year to August 2019. And this, allied with that aforementioned share price drop, means that WH Smith boasts a dirt-cheap forward sub-1 PEG reading of 0.9.

Time and again I’ve lauded the brilliant profits potential of the business’s Travel division and I’m pleased to see that Smiths continues to think big here. Its stock value surged on Tuesday (up 7% as I type, in fact) following news that it has agreed to buy US travel retailer InMotion for £155m.

The company, which sells digital accessories in airport locations Stateside, marks a significant step in WH Smith’s international expansion programme. It doubles the size of the British firm’s international travel operations and gives it a significant foothold in the US, the world’s biggest travel retail market.

It’s not difficult, then, to envisage profits continuing to rip higher beyond the current year, and to continue dragging dividends with it. In the meantime, investors can sit back and enjoy the predicted payout of 57.2p per share for the current fiscal period, a figure that yields a fatty 3.1%.

Trayning higher

Fortunately, Begbies Traynor Group (LSE: BEG) hasn’t endured the sell-off affecting much of the broader market in recent weeks.

The corporate insolvencies specialist thrives in times of challenging economic conditions. After all, and with fears over the health of the UK economy in particular rising, it’s not a surprise to see its share price rise in October.

Data released today from the Insolvency Service shows why investors have been getting increasingly bullish over Begbies Traynor. The government body advised that the number of corporate solvencies reported between July and September leapt almost 20% year-on-year, representing the fastest increase since the financial crisis almost a decade ago.

Right now, Begbies Traynor is expected to record a 9% earnings rise in the year to April 2019, and another 4% rise in fiscal 2020. It’s very easy to see these City brokers significantly upgrading their figures in the months to come, as the turbulence hitting the UK only looks set to rise, as the fallout of the 2016 Brexit referendum drags on.

As such, I reckon the small-cap’s forward P/E ratio of 16.4 times actually looks pretty undemanding right now. With anticipated dividends of 2.6p and 2.7p per share for this year and next, respectively, offering up chunky yields of 3.6% and 3.7% too, I reckon it’s a great share to buy and hold onto for years to come, and particularly so if Brexit negotiations take a turn for the worse.

The post Have £1,000 to invest? 2 brilliantly-valued dividend stocks that I’d buy and hold for 10 years appeared first on The Twelfth Magpie.

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• Here’s why WH Smith shares just crashed 20%!

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended WH Smith. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Investors would be foolish to channel all of their efforts into hunting for large-to-mid-cap businesses on these indices, however, as there are plenty of great income shares on the capital’s lower listings that could also make you a fortune now and in the years ahead.

M&A mammoth

One of these little-known lovelies is Randall & Quilter Investment Holdings (LSE: RQIH), a business whose restructuring drive promises to light a fire under already-impressive earnings growth. Pre-tax profit from continuing operations soared 40% during January-June to £7.8m.

The insurance leviathan has undergone a strategic overhaul to focus solely upon the fast-growing legacy and program underwriting management segments, resulting in the disposal of its Lloyd’s Managing Agency and Insurance Services late last year and in early 2018.

And Randall & Quilter has used these funds to help finance blockbuster M&A to boost its position in North America and Europe. Last month it made its biggest ever acquisition with the takeover  of Global Re US, while it also dusted off the chequebook to buy UK-based MPS Risk Solutions (both purchases are subject to regulatory approval).

It’s no great surprise that City brokers are expecting earnings at the AIM-quoted firm to leap 31% in 2018 and 39% in 2019 given the rate at which it is winning business. It expects more contracts to be signed before the end of the year that will result in annualised gross written premiums around the $500m marker. Randall & Quilter has said that profits estimates could be even higher should the Global Re US takeover receive regulatory sign-off before the end of 2018.

With profits blowing higher it’s also no shock that the number crunchers are predicting impressive dividends. The anticipated 9.1p per share dividend for this year yields an exceptional 4.8% and the dial moves to 4.9% for 2019 thanks to the expected 9.3p payout.

Right now Randall & Quilter carries a forward P/E ratio of just 13.7 times. This is far too cheap in my opinion given the company’s rapidly-improving growth outlook.

Dividends training higher

The trading outlook for Begbies Traynor (LSE: BEG) is also steadily getting better as economic conditions become ever tougher.

The business recovery specialist announced this week that the number of insolvencies in the UK continues to increase, with government statistics showing the total of corporate insolvency appointments rising 6% in the six months to June to 7,915.

Right now City brokers are expecting earnings at Begbies Traynor to edge 4% higher in the year to April 2019, helped by recent acquisition activity, before profits expansion blasts to 21% in fiscal 2020. And the possibility of more M&A action could supercharge earnings growth further out.

This is a good omen for long-term dividend growth as well. In the meantime, though, payouts are expected to rise to 2.5p and 2.8p per share for this year and next respectively, figures that yield a chunky 3.5% and 4%.

Right now the firm boasts a slightly-toppy forward P/E multiple of 17 times, but in my opinion this slight multiple is justified given Begbies Traynor’s position as an increasingly exciting growth and income share.

The post Have £2,000 to spend? 2 unknown but amazing dividend stocks that could help you to retire early appeared first on The Twelfth Magpie.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.