Trouble Brewin?

This kind of mismatch is familiar to regular readers of company reports, as management and markets have very different ideas of what constitutes successful. Luckily in this sector, there’s one good benchmark in the advisor sector, investment platform Hargreaves Lansdown (LSE: HL), which has been setting the pace for years.

FTSE 250-listed Brewin Dolphin produced some positive figures today, including a 10.7% jump in pre-tax profits to £77.5m, slightly better than expected. Total funds under management grew 6.7% to £42.8bn, although analysts had hoped for £43.1bn.

Discretionary funds under management rose 11.2% to £37.6bn, helped by strong gross inflows of £3.2bn, and stable outflows of £1.3bn.

Strong stuff

Basic earnings per share jumped 18% to 19.5p, while Brewin hiked its full-year dividend by 9.3% to 16.4p a share. Nicol said the results proved the continued value of its personalised advice-led model, which was driving “strong earnings and dividend growth.”

The market response looks a little harsh and may reflect wider uncertainties amid Brexit and global growth fears. However, this could work in the group’s favour by driving demand for personalised advice. Perhaps it reflects a valuation of 15.3 times earnings, which is hardly bargain territory, despite a 10% share price dip in the past six months.

Its stock is up a modest 20% over five years, so maybe investors are generally wary. Yet earnings growth is steady, and the stock now yields a wealth-generating 4.9%, with cover of 1.3. Tempting.

Big juicy bagger

Brewin Dolphin is betting that demand for its high-margin wealth management services will remain robust. In contrast, Hargreaves Lansdown has made a hugely successful play for the DIY investor market, where its online platform is the biggest hitter. Investors have reaped the benefit, with the stock up 60% in the last two years, while over 10 years, it’s a 12-bagger, its share price rising from 165p to 1948p over that time.

As ever, the big question is whether it can continue to grow at the same breakneck pace. Actually, that’s easy to answer. FTSE 100 companies simply can’t do it purely due to their scale, as Hargreaves now has a hefty market capitalisation of £9.25bn.

Keep going

My worry is that it’s still priced for rapid growth, trading at 37.9 times forecast earnings. On the other hand, it has continued to deliver, with net customer inflows of £7.6bn in the year to 30 June, up an impressive 10%. City analysts are forecasting 13% earnings per share growth in the year to next June, so it might deliver again. It also enjoys high profit margins, currently 65.3%.

Further stock market volatility would be a blow, especially if this scares away mass market private investors. However, October’s travails left the stock trading 15% below its year-high of 2280p, so today might even be a buying opportunity. Hargreaves cannot keep rising forever, but I’ve said that before, and it proved me wrong then.

The post Can these 2 growth and income heroes continue to make investors wealthy? appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• 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?

harveyj has no position in any of the shares mentioned. The Motley Fool UK has recommended Hargreaves Lansdown. 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.

Tempting growth

Brewin Dolphin (LSE: BRW), the FTSE 250 investment management company, seems attractive to me because of its tempting outlook on earnings growth.

Amid a changing market landscape, the company is leveraging its current strengths to take advantage of shifting in client needs. It has positioned itself in a strong position to take advantage of the fast growing intermediaries-led channel and has continued to attract steady fund inflows, which is translating into healthy earnings growth and further growth opportunities.

Brewin Dolphin is also continuing to move away from traditional stockbroking towards higher-margin wealth management services, a market where it is seeing robust double-digit revenue growth. Against an uncertain macroeconomic backdrop, its expanding advice-led proposition has enduring relevance for customers in uncertain and complex times.

Undemanding valuations

With the company well placed to invest and innovate for further growth opportunities, valuations seem undemanding. Although the stock trades at 17.1 times its adjusted earnings last year, City analysts are predicting underlying earnings growth of 8% this year, with an acceleration to 12% for 2019. As such, its forward P/E is a more modest 15.7 on this year’s expected earnings, and is set to fall further to just 14 by 2019.

Dividends per share are also forecast to grow impressively, from 15p last year, to 16.6p this year and to 18,3p by 2019, representing annualised dividend growth of more than 12%. This means its yield is set to rise from 4.4% currently, to just over 5.3% within two years.

Favourable fundamentals

Elsewhere, Tritax Big Box REIT (LSE: BBOX), the landlord and developer of large-scale logistics facilities, also offers enticing dividend growth.

Favourable market fundamentals, particularly the shift towards e-commerce and tight supply of suitable properties, means management is confident about delivering continued growth in rental income and property values in 2018. The company also has an attractive short cycle pipeline of new pre-let developments, adding to its outlook of value creation.

Resilient sector

In 2017, the company achieved growth in net asset value (NAV) per share of 10.3% to 142.2p, demonstrating the resilience of the warehousing sector amid a slowdown in the wider property market.

Looking ahead, it isn’t too concerned about Brexit either, as it reckons increased border controls would mean its customers would require more warehousing domestically, further increasing demand for the type of property which the company invests in.

Shares in the REIT are fairly valued, with its share price in line with its NAV, down from a 12% premium a year ago. Tritax Big Box REIT also offers a tempting prospective dividend yield of 4.7%, up from 3.6% last year.

The post 2 top FTSE 250 dividend stocks with 4%+ yields appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• 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?

Jack Tang has no position in any 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.

Tarsus Group (LSE: TRS) provides business-to-business services — exhibitions, conferences, and that kind of stuff. And it’s provided investors with a 70% share price appreciation over five years, to 306p.

But dividends are what drew me to Tarsus, with their progressive nature. Yields are around 3.5%, a bit ahead of the FTSE 100 average, but the annual cash has grown from 6.8p in 2012 to 9.1p in 2016 — a 34% rise in four years, and way ahead of inflation.

Forecast hikes would take it to 10.3p by 2018. And if you’d bought Tarsus shares at the start of 2012, the forecast 2018 dividend would yield an effective 7.4% on your purchase price — and that’s what progressive dividends are all about.

In a trading update Thursday, Tarsus told us its busier second half was doing well, with strong performances at major events and buyers up 7%. Like-for-like bookings for the full year are up 8%, “promising another strong year.” And with the Dubai Airshow still to come, I can see full-year figures being in line with current forecasts.

Lumpy

That would suggest a 75% rise in earnings per share (EPS), which would drop the P/E multiple to under 11, which I think is pretty undemanding — but I do see a clear reason for the low valuation.

The thing is, the nature of Tarsus’s business, relying heavily on large trade shows and major exhibitions, means its profits are erratic. We’ve seen up years alternating with down years, and the same looks set to come — 2018 should see EPS dropping by 32%.

But the long-term earnings trend is steadily upwards, and those very well-covered dividends make me think the current share price is well worth paying.

Investment cash

Another progressive dividend stock I like is Brewin Dolphin Holdings (LSE: BRW), whose payment hikes have been easily beating inflation. Between 2012 and 2016, the dividend was raised from 7.15p to 13p, for an 80% uplift — and City analysts have rises to 16.2p pencilled in by 2018.

Cover by earnings has admittedly dropped in that period, with a figure of around 1.3 times on the cards for 2018, but that doesn’t unduly worry me at this stage.

At Q3 time, the investment manager told us that total funds had risen in the quarter by 3.7%, to £39.2bn. It also enjoyed record income of £77.3m (up 8.4% on the same period last year), with fee income up 16% to £55m, though commission income fell 11% to £16.7m.

Brewin Dolphin acquired Duncan Lawrie Asset Management in May, and chief executive David Nicol reckons the integration is going well. Mr Nicol also spoke of “delivering against our long-term growth strategy,” saying that “confidence in the future is underpinned by our robust financial position.“

What value?

On the fundamental valuation front, a forward P/E of 18.5 (against a predicted EPS rise of 8%) might look a bit high to some, but further growth of 15% indicated for 2018 would drop that to around 16.

Some may also fear that the firm’s recent strong performance has been on the back of the weakness of sterling which has added apparent strength to the stock market (that is essentially valued in US dollars), but I see more than that.

Brewin Dolphin looks to me like a very well managed company with a long-term view, and companies of that nature deserve to command an above-average valuation.

At 353p, I see the shares as a good long-term income prospect.

The post 2 bargain small-cap dividend stocks I’d buy today appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• 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?

Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has recommended Tarsus Group. 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.

Iron BRW

Wealth manager Brewin Dolphin Holdings (LSE: BRW) has struck it rich for investors lately, with its share price up 43% in the last 12 months. Performance looks just as impressive over five years, with a return of nearly 150%. They say a rising stock market floats all boats, and this is especially the case for financial stocks. These are impressive figures, whatever they say.

The question now is whether you should put money into a wealth manager just as the world seems to be convincing itself the stock market is going to crash. Don’t let that scare you away. People have been fretting over a crash every single day of this tremendous eight-year bull run.

Day of the dolphin

Brewin Dolphin’s growth figures are impressive, with total funds up 6.8% in the year to 31 March 2017 to £37.8bn and discretionary funds rising 9.4% year-on-year to £31.5bn. Basic earnings per share (EPS) increased by 13.1% to 9.5p while the interim first-half dividend of 4.25p per share rose 10.4%.

Growth prospects look promising, with City analysts forecasting a 15% rise in EPS in 2018, when the yield should hit 4.6%. Forecast operating margins of 22.3% also tempt but naturally there is a price to pay for all of this. It currently trades at a forecast valuation of 18.3 times earnings, and a forecast price-to-earnings growth ratio (PEG) of 2.5. That reflects its healthy growth prospects, provided you understand that at today’s price you are vulnerable if markets crash.

Silver screen

Cineworld Group (LSE: CINE) has been even more compelling viewing in recent years, its share price up 25% in 12 months, and a blockbusting 252% over five years. However, like Brewin Dolphin, it is also looking expensive at a forecast valuation of 18.3 times earnings, while its PEG ratio stands at 2.2. Is it worth the price of admission?

The global movie screen operator relies on a steady stream of audience-grabbing blockbuster movies to drive its profits and recent Hollywood output hasn’t disappointed. From 1 January to 11 May highest grossing films included Beauty and the Beast, La La Land, Sing, Guardians of the Galaxy Vol. 2, The Fate of the Furious and The Lego Batman Movie. These drove revenues up 15.8% with “particularly good performances” in the UK, Israel, Romania and Slovakia.

Cinephile

New screen openings and an ongoing refurbishment programme have also helped attract audiences, while new Starbucks outlets and VIP sites have driven retail revenues. Higher movie admissions also means higher advertising revenues.

Cineworld has posted double-digit EPS growth for each of the three years to 2016 and although this looks set to slow, few would turn up their noses at forecast 8% growth in 2017 and 9% growth next year. People still love a night at the movies. Yes, the stock is a little expensive, but this is a company that has driven revenues from £351m in 2012 to a forecast £951m in 2018, with few hiccups along the way. It also offers a forecast yield of 3%, covered 1.8 times. I’ll have some popcorn with that.

The post Are these FTSE 250 growth heroes too pricey? appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• 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?

Harvey Jones has no position in any 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.

Wealth generates profit

If I showed you a company that has nearly doubled its annual dividend in five years, and has forecasts for big rises this year and next which would massively outstrip inflation and which should be amply covered by earnings, would you be impressed?

And what if I told you its share price had trebled over that same period, to 346p today?

Well, that’s the recent track record of investment manager Brewin Dolphin Holdings (LSE: BRW). That stock market bullishness we’ve seen of late, fuelled by the fall in sterling, has helped make that look good. But over the five-year period, Brewin Dolphin shares have run massively ahead of the FTSE 100 overall — a good investment manager can be a nice way to gear up profits from a rising stock market.

Good so far

Interim results in May support the City’s predictions, with funds under management up 6.8% (against a 6.1% rise in the FTSE 100), and net discretionary inflows up by an annualised 7.6%.

Adjusted EPS gained 13%, which is well ahead of the mooted full-year rise of 7%, and the interim dividend was lifted by 10.4%.

We’re looking at a forward P/E of 15.6 for 2018, which I see as a modest valuation for a company whose dividend is expected to yield 4.7% that year. And the big share price rise we’ve already seen — well, I see that as a nice extra bonus for income seekers.

Top property share?

As dividend picks go, a company that only started paying them in 2016 might look like a strange one to plump for, but that’s deceptive.

And the commercial letting business might not sound very exciting (though if you want excitement, I’d say put your money into safe long-term investments and go bungee jumping). But that’s what CLS Holdings (LSE: CLI) does, and I reckon it does it pretty well.

The thing is, CLS has actually been redistributing cash to shareholders for years, in the form of buybacks — so those who wanted income would have to sell some shares to get it. But last year, after more than doubling its EPS over the previous five years, the company switched to a progressive dividend policy and shelled out for a 2.6% yield.

That’s a 23% increase in distributions over the previous year, and analysts are expecting the yield to reach 3.4% by 2018. Those rises are well ahead of inflation, and with strong cover by earnings, I can see an attractive long-term upwards trend here.

Oodles of cash

CLS aims to provide stable long-term cash flows, which is the lifeblood of any income investment. And along with 2016 results, executive chairman Henry Klotz spoke of the company’s “strong balance sheet and ample liquid resources“.

The share price has more than trebled over the past five years to 214p, though now that distributions have switched to dividends that’s likely to slow. We’re looking at P/E multiples of around 19, which might seem a bit high, but with a basic net asset value per share of 215p at December (adjusted for May’s 10-1 split), I’m seeing good value.

The post Two ‘hidden’ income stocks that could help you retire a millionaire appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• 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?

Alan Oscroft has no position in any 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.

Improving performance

One beneficiary of rising share prices is likely to be Brewin Dolphin (LSE: BRW). The investment management company reported an upbeat set of half-year results on Wednesday. They show that it was able to increase total funds under management by 6.8%. Its discretionary funds rose by 9.4%, which compares to a 6.1% increase in the FTSE 100 index. As such, it appears as though the company’s sales strategy is working well at the present time.

The company’s adjusted profit before tax of £32.4m was 14.1% higher than in the same period of the prior year. The acquisition of Duncan Lawrie Asset Management could have a positive impact on the company’s profitability in future. Capital is available for further M&A activity to complement organic growth, with Brewin Dolphin enjoying an increasingly dominant position within the UK wealth management space.

Looking ahead to the rest of the year, Brewin Dolphin is expected to record a rise in its earnings of 8%. This is due to be followed with growth of 12% next year, which puts the company’s shares on a price-to-earnings growth (PEG) ratio of just 1.2. This indicates that now could be the perfect time to buy them – especially if share prices continue to move higher.

Low valuation

Also offering growth at a reasonable price within the wealth management industry is Brooks Macdonald (LSE: BRK). As with Brewin Dolphin, it is likely to benefit from higher share prices. While there is potential for the FTSE 350 to experience a pullback if political uncertainty in the US and Europe continues to build, the company’s valuation indicates that it offers a sufficiently wide margin of safety to merit investment. For example, it trades on a PEG ratio of just one, thanks to its double-digit earnings growth outlook over the next two years.

As well as growth potential, Brooks Macdonald also offers upbeat income prospects. It may only yield 1.9% at the present time, but dividends per share are expected to rise by 19% next year. This puts it on a forward dividend yield of 2.2%. Since dividends are due to be covered 2.4 times by profit, there seems to be scope for a further rapid rise in shareholder payouts over the medium term. This mix of improving income prospects and a low valuation mean that it could be a star performer within an enticing sector.

The post These FTSE 250 growth stocks look grossly undervalued appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• 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?

Peter Stephens has no position in any 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.

A solid financial services stock

Wealth manager Brewin Dolphin (LSE: BRW) currently yields 4.6%. That is almost 1% higher than the FTSE 100’s yield. Furthermore, the company’s shareholder payouts seem to be well-covered by profit, with it having a dividend coverage ratio of over 1.3. This indicates that even if profit growth should be somewhat lacklustre, Brewin Dolphin could still increase dividends at a relatively brisk pace so as to maintain real-terms dividend growth over the medium term.

The company is forecast to record a rise in its bottom line of 14% next year. This may be somewhat surprising, since Brexit may be viewed as a major threat to its business. But since the performance of the FTSE 100 is driven largely by the international economic outlook and the strength of sterling, it may offer high capital gains in 2017 and beyond. Since Brewin Dolphin’s financial performance is linked to the level of the wider index, it could enjoy a prosperous period in future.

With the company’s shares trading on a price-to-earnings growth (PEG) ratio of just 1, they appear to offer excellent value for money. While it may not be an obvious income choice for many investors, it nevertheless appears to be a worthwhile purchase which is capable of beating the FTSE 100 in 2017.

High-risk dividend opportunity?

Global mobile satellite communications services specialist Inmarsat (LSE: ISAT) may not be the most stable of stocks, but its yield indicates that it is worth buying for the long term. It currently yields 7.2%, which is almost twice the FTSE 100’s yield. As such, it is set to offer an almost unrivalled income return in the next few years, which could cause investor demand for its shares to rise rapidly.

However, recent results have been somewhat mixed. Inmarsat’s profit has fallen in each of the last two years, and it is forecast to record a decline in its earnings of 9% this year. While disappointing, growth of 18% in 2018 should help to boost its dividend coverage ratio of around one and provide a potential catalyst for its share price.

Trading on a PEG ratio of 0.7, Inmarsat appears to be cheap. It may not offer the stability or consistency of other FTSE 350 income shares, but its high yield appears to make up for this. Alongside its stunning growth potential and low valuation, this means that it could outperform the FTSE 100, not just in 2017, but in future years too.

The post 2 ‘forgotten’ dividend stocks with FTSE 100-beating potential appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• 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?

Peter Stephens has no position in any shares mentioned. 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.

For example, Barclays trades on a price-to-earnings (P/E) ratio of just 10 at the present time and this indicates that there’s tremendous potential for an upward rerating. The chances of that happening are increased significantly by Barclays’ upbeat earnings growth prospects, with the bank expected to increase its bottom line by 40% in the next financial year. This puts it on a price-to-earnings-growth (PEG) ratio of just 0.2, which shows that it offers stunning growth at a very reasonable price.

Furthermore, with Barclays implementing a new strategy that will see it dispose of non-core assets and focus on improving its capital position, investor sentiment could gradually increase as Barclays becomes a more financially sound and profitable bank.

Swimming with (Brewin) Dolphin

Also offering upside potential is investment management company Brewin Dolphin (LSE: BRW). Certainly, 2016 has been a tough year thus far for the business, with increased market volatility causing a degree of uncertainty regarding its financial future. As such, investors are pencilling in a fall in the company’s bottom line of 5% in the current year.

While this result would be disappointing, Brewin Dolphin is expected to bounce back next year with growth in earnings of 15%. This could cause investor sentiment to pick up strongly and with its shares having a PEG ratio of 0.9, they seem to be very attractively priced. Clearly, further market volatility or a fall in the price level of the FTSE 100 could cause Brewin Dolphin’s forecasts to be downgraded. However, with such an appealing valuation it seems to offer a wide margin of safety for long-term investors.

One to watch

Meanwhile, interdealer broker ICAP (LSE: IAP) doesn’t appear to be as enticing for investors as Barclays or Brewin Dolphin. Much of that comes down to its valuation, with it currently trading on a P/E ratio of 16.4, which indicates that its shares may be fully valued. And while ICAP is expected to increase its earnings by 12% this year and by a further 6% next year, there are better value and faster growing options elsewhere.

Certainly, ICAP has the potential to grow its bottom line at a rapid rate in future years, with its planned deal to merge with Tullett Prebon offering synergies and increased financial strength. However, with any merger there are always risks that integration won’t be smooth and with ICAP having such a narrow margin of safety, it appears to be a stock to watch rather than buy at the present time.

The post Are Barclays plc, ICAP plc and Brewin Dolphin Holdings plc the best stock tips of all-time? appeared first on The Twelfth Magpie.

More reading

• Why Barclays shares could have a huge second half of 2026
• Up 50% in a year! That’s not the only reason I’d consider buying Barclays over Nvidia stock today
• Barclays shares could soon soar another 21%, according to the latest price target
• After a 160% rally, major brokers still see more gains for Barclays shares. Here’s why
• How many Barclays shares do I need to buy to get a £1,000 passive income?

Peter Stephens owns shares of Barclays. The Motley Fool UK has recommended Barclays. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

However, the results include the performance of Quindell’s professional services division, which has now been sold. And, since the end of the first-half period, Quindell has experienced a continuation in challenging trading conditions owing to reputational damage. It has also seen a decline in sales at its Himex division, where there was a temporary disruption in supply with one of its US customers.

Clearly, Quindell is a company in the midst of very difficult circumstances. It remains under investigation by the SFO, is restructuring following the sale of a major part of its business (from which it will return up to £500m to shareholders) and it is also now the subject of a £9m legal claim. So, while today’s update is something of a relief for the company’s investors, Quindell’s share price may yet come under further pressure, which makes it a company worth watching rather than buying at the present time.

Similarly, owner of Costa Coffee and Premier Inn, Whitbread (LSE: WTB), is also enduring a somewhat challenging period. That’s because the impact of the Living Wage is likely to cause its costs to go up and, rather than have squeezed margins, Whitbread is apparently planning on raising prices. This could hurt sales and cause the company to disappoint on its ambitious earnings growth guidance.

Of course, Whitbread remains a high quality company with a sound balance sheet and very efficient, lean business model. However, having risen by 189% in the last five years, its shares appear to be fully valued due to them trading on a price to earnings (P/E) ratio of 19.7. And, while the coming months could yield continued growth, rising costs may hurt the business in the long run.

Meanwhile, wealth manager Brewin Dolphin (LSE: BRW) appears to offer a potent mix of income, growth and value credentials. For example, it trades on a P/E ratio of 14.8 and, when its earnings growth forecasts for the next two years are taken into account, this equates to a price to earnings growth (PEG) ratio of just 1.1. This indicates that Brewin Dolphin’s shares offer growth at a very reasonable price.

Furthermore, as with a number of financial stocks at the present time, Brewin Dolphin offers a top notch yield, with it currently standing at 4.4%. And, with it being covered 1.5 times by profit, there is significant scope for it to rise in future, thereby offering inflation-beating dividend growth in 2016 and beyond.

The post Is Now The Perfect Time To Buy Quindell PLC, Whitbread plc And Brewin Dolphin Holdings plc? appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• 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?

Peter Stephens has no position in any shares mentioned. 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.

However, this uncertainty and understandable question marks appear to be priced in to Barclays’ share price. Certainly, the apparent end of the Greek debt crisis is good for investor sentiment in the short run, but in the long run Barclays appears to offer substantial rerating potential. For example, it trades on a forward price to earnings (P/E) ratio of just 9.7 and this indicates that its shares are very cheap and also price in the uncertainty that is set to increase in the coming months.

Furthermore, Barclays is a hugely profitable, well-run bank that is not enduring the challenges that many of its competitors face. For example, it is not overly exposed to one particular, struggling region and has an efficient business model that is not experiencing spiralling costs. In addition, its bottom line is set to grow at a double-digit rate per annum over the next few years.

Similarly, challenger bank, Shawbrook (LSE: SHAW), is also priced to sell at the moment. It trades on a forward P/E ratio of just 10.8 which, when you consider that its financial performance has been relatively impressive, appears to be a low price to pay.

Of course, the real potential for investors in Shawbrook is with regard to its income prospects. While it is set to yield just 1.1% next year, Shawbrook is expected to pay out just 12% of profit as a dividend in 2016. That’s exceptionally low and, in fact, if it were to pay out a still very affordable 50% of profit as a dividend, it would equate to a yield of 4.6%. As such, it could become a superb income play – especially if it can continue to post strong profit growth.

Meanwhile, wealth management company, Brewin Dolphin (LSE: BRW), has an excellent track record of growth. It has produced earnings growth in each of the last five years, with it averaging 10% per annum during the period. And, looking ahead, more growth is on the horizon, with Brewin Dolphin set to benefit from an improving UK economy and moderately high FTSE 100 to post growth of 11% this year and 13% next year.

Despite this excellent growth profile, Brewin Dolphin still offers good value for money. Evidence of this can be seen in its price to earnings growth (PEG) ratio of just 1.1, which indicates that it offers growth at a very reasonable price. And, with Brewin Dolphin set to yield as much as 4.4% next year, it could prove to be a top notch income play, too.

The post 3 Finance Stocks Set To Soar: Barclays PLC, Shawbrook Group PLC And Brewin Dolphin Holdings plc appeared first on The Twelfth Magpie.

More reading

• Why Barclays shares could have a huge second half of 2026
• Up 50% in a year! That’s not the only reason I’d consider buying Barclays over Nvidia stock today
• Barclays shares could soon soar another 21%, according to the latest price target
• After a 160% rally, major brokers still see more gains for Barclays shares. Here’s why
• How many Barclays shares do I need to buy to get a £1,000 passive income?

Peter Stephens owns shares of Barclays. The Motley Fool UK has recommended Barclays. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.