With that in mind, here are two shares with bright financial outlooks. They could therefore deliver improved share price performance in the long run.

Positive performance

Reporting on Tuesday was business-to-business information, insight and events group Centaur Media (LSE: CAU). The company has experienced challenging headwinds in some of its markets, but has nevertheless performed in line with market expectations. It continues to make good progress regarding its cash collection and debtor reduction. Its transition away from print advertising is also progressing, with it set to represent less than 4% of total revenues in 2018. The company also announced the appointment of a new Chairman in its update.

Looking ahead to next year, the business is due to report a rise in earnings of 14%. This could help to improve investor sentiment in the stock after what has been a rather mixed number of years. And with it trading on a price-to-earnings growth (PEG) ratio of just 1.1, it appears to offer considerable upside potential.

In addition, Centaur Media also has a relatively bright outlook from an income perspective. It has a dividend yield that is currently in excess of 6%, and this could help to improve investor sentiment. Inflation has recently risen to 3.1% and with the prospect of an even higher rate in future, the company could be a sound means of overcoming a major to risk to investors in 2018.

Strong track record

Of course, investors may also begin to increasingly reward companies with a solid track record of growth as well as stocks that offer high levels of earnings increases. For example, food supplier Compass Group (LSE: CPG) has an excellent history of delivering high earnings growth, with its bottom line having risen in each of the last five years. In fact, its earnings growth rate has averaged over 11% during that time, which may appeal to investors ahead of Brexit.

Clearly, Brexit could prove to be a positive change for the UK economy. It may provide increased growth potential in the long run. However, in the short run it may mean added uncertainty as business and consumer confidence comes under pressure. This could make defensive shares such as Compass more attractive to investors, which could result in a higher rating being applied to the company’s shares.

With a price-to-earnings (P/E) ratio of just under 20, Compass Group may appear to be relatively expensive at the present time. However, with a defensive business model and a track record of consistent earnings growth, it could be a worthwhile share to hold given the macroeconomic uncertainty which may be ahead for UK investors.

The post 2 growth stocks for the long term appeared first on The Twelfth Magpie.

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Peter Stephens has no position in any shares mentioned. The Motley Fool UK has recommended Compass 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.

In this article I’m going to take a closer look at two small-caps I believe offer attractive growth potential, backed by solid financials.

The next Woodford?

Fund manager Miton Group (LSE: MGR) has made its name as a specialist small-cap investment firm. The company’s star attraction is Gervais Williams, who is the group’s head fund manager and an executive director of its board. Mr Williams also owns 6.9% of Miton stock. This should ensure that his interests are well-aligned with those of shareholders.

The group’s share price has risen by 86% over the last year, but it remains a small company, with a market cap of just £66.7m. Recent trading suggests to me that the outlook for growth remains strong.

Assets under management rose by 15% to £3,354m during the six months to 30 June, compared to a gain of 9% for the FTSE SmallCap index and 13% for the AIM All-Share Index. The increase in assets was divided fairly equally between investor inflows (up by £195m) and investment performance (up £254m). This suggests Miton’s strong fund performance is attracting new investors.

To support shareholder returns, the group used some of its net cash to buy back £2.6m of shares earlier in the year. Net cash at the end of June remained fairly high, at £18.2m, so further shareholder returns may be possible.

The stock isn’t quite as cheap as it was, but still looks reasonably priced on a 2017 forecast P/E of 16, falling to a P/E of 13.5 for 2018. I’d hold on for more at current levels.

Valuable information

Many publishing and media companies are struggling to stay profitable in the internet age. One of the few remaining areas of profitable growth lies in providing information-based digital services to corporate customers.

That’s where Centaur Media (LSE: CAU) comes in. This group provides “business to business information, insight and events”. Its share price has risen by 14% this year, as it’s continued a shift away from print media and towards business-to-business services.

The latest step forward came last week. Centaur announced the sale of its Home Interest consumer business for £32m, and the acquisition of the UK’s number one telemarketing agency, MarketMakers, for a total of up to £20.1m.

This company is midway through a complex shift in its operations. But its financial performance seems to be improving. Net debt has fallen steadily and the group is expected to report modest revenue growth this year.

Broker forecasts put the stock on a forecast P/E of 13 for 2017, falling to 11.5 in 2018. This level of earnings should be enough to cover the group’s 3p per share dividend, which provides a yield of 6.1%. City analysts expect this dividend to be maintained and have an average price target for the stock of 59p — 20% above current levels. In my view, Centaur could be a profitable buy over a three-to-five-year timeframe.

The post These super small-caps could help you retire early appeared first on The Twelfth Magpie.

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Roland Head 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.

Media on the mend

Shares in Centaur Media (LSE: CAU) have had a rotten year, falling 43% to 44.5p — but at least that includes a 1.7% uptick today as a result of the firm’s latest quarterly update, and we’ve seen a 33% recovery since the year’s low in early July.

Centaur, which does business to business information and events management, reported a 10% rise in digital revenues in Q3, with Legal services leading the way. Live event revenues gained 20%, with a nice 19% boost from the London Homebuilding Show.

The only downer was from advertising revenue, which fell 12% as print advertising revenue plunged by 21%. But overall, the firm says its cost reduction plan is going well, cashflow is good, and it’s on track to meet market expectations for the full year.

And that’s where dividends come in, with an attractive yield of 6.7% forecast for this year and similar for 2017. The risk at the moment seems to be covered by earnings, which would amount to only 1.45 times this year as earnings are expected to fall by 20% — and that seems too low for comfort for a company that’s been showing slightly erratic earnings. But a predicted recovery in 2017 earnings would see cover rising to 1.7 times, which is a good bit healthier.

Any company with a market cap as low as £64m is risky. But a low forward P/E of 10 this year, dropping to 8.5 next, makes me think there’s enough in dividends and in undervaluation to make Centaur a risk worth taking.

Challenger bank

With the UK’s big banks facing a post-Brexit rout, the time seems ripe for the so-called challenger banks to rise. Virgin Money is perhaps the best known, but I think we could be seeing a nice little growth investment in Metro Bank (LSE: MTRO).

Metro Bank only floated in March this year, and since then its shares are up 27% to 2,736p. The EU referendum result did send them down along with the rest of the sector, but if you’d got in immediately after on 27 June, you’d be sitting on a cracking 67% profit today.

A third-quarter update didn’t really move the share price as it’s pretty much in line with expectations, but we’re still looking at an impressive start to life as a public company — with deposits up 66% year-on-year, lending up 73%, revenues up 78%, and customer numbers up by 68,000 to 848,000.

And after a £3.4m loss was recorded in the second quarter, Metro made an underlying pre-tax profit of £0.6m in Q3, which should be the turning point. There’s still a loss on the cards for the full year, but analysts are predicting earnings of 25p to 26p per share for 2017.

Metro Bank, like Virgin Money, isn’t saddled with any of the legacy issues of its giant rivals. And with its focus entirely on the UK retail market and with the potential to growth rapidly from a very small base, I reckon this could be a great growth opportunity. There are no dividends on the horizon yet, obviously, but they surely can’t be too far in the future.

The post Should you snap up this great growth and dividend stock combo? appeared first on The Twelfth Magpie.

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Alan Oscroft 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.

Road warrior

Broad risk-aversion has seen coaches colossus National Express (LSE: NEX) slip 1% on Wednesday despite the release of an upbeat trading update.

National Express advised that it “has made a strong start to the year, with total revenue up 11% in the period on a constant currency basis” in the year to 1 April. Underlying sales were up 4% during the period, the firm added, with revenues growing across all its divisions.

National Express managed to post underlying revenue growth of 4% at its UK Coach division, despite the impact of recent terror-related incidents in Belgium in March, with passenger numbers rising 6% in the period.

With National Express clearly making strong progress at home and abroad, the City expects earnings to rise 6% in 2016 alone, resulting in a very attractive P/E rating of 13.2 times.

And a chunky dividend yield of 3.7% for the year makes the bus-and-train operator an attractive investment destination, in my opinion.

Media star

Business information and media specialist Centaur Media (LSE: CAU) also furnished the market with a bright trading update in midweek business. However, this couldn’t stop the stock slumping to fresh two-and-a-half-year lows below 50p.

Centaur announced that revenues had risen 5% between January and April, prompting it to affirm its full-year guidance for 2016.

Centaur added that “paid-for content and exhibitions revenues continue to grow well, although we are currently experiencing some market pressure in advertising and sponsorship revenues.”

The City expects growth in its high-quality channels to deliver plump returns in the coming years, and Centaur is expected to follow flatlining earnings in 2016 with a 10% jump in 2017. Consequently the media play boasts ultra-low P/E ratings of 9.2 times and 8.6 times for these periods.

And dividend hunters should give dividend projections for Centaur serious attention — the firm boasts market-bashing yields of 6.2% and 6.7% for 2016 and 2017.

Credit concerns

Credit report provider Experian (LSE: EXPN) also saw its share price slip on Wednesday, the firm enduring a 2% fall following a patchy set of trading numbers.

Experian advised that revenues slipped 4% in the year to March 2016, to $4.5bn, reflecting the adverse impact of currency movements. At constant exchange rates the top line actually grew 5% in the period.

Profit before tax clocked in at just over $1bn during the period, up marginally year-on-year.

Experian also announced plans to buy back $400m worth of shares in the current fiscal year, drawing to a close the current $800m repurchase programme.

While the City expects earnings to grow 5% in 2017, this figure results in an elevated P/E rating of 19 times. And a 2.3% dividend yields for the current year lags the prospective FTSE 100 average of 3.5% by some margin.

Given the likelihood of further chronic currency headaches this year and beyond, I believe Experian is an unattractive stock selection at current prices.

The post Should you buy Experian plc, National Express Group plc and Centaur Media plc today? appeared first on The Twelfth Magpie.

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Royston Wild 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.

Creaking balance sheets and poor earnings outlooks have put paid to the progressive policies of many of the index’s go-to dividend stocks, leading many investors to look further afield for strong — and reliable — income flows.

With this in mind I’m looking at four London stars outside the FTSE 100 that appear on course to deliver stunning returns.

Build a fortune

FTSE 250 play 3i Infrastructure’s (LSE: 3IN) focus on core infrastructure projects across Europe makes it a solid selection for those seeking abundant dividend flows, in my opinion.

3i Infrastructure saw its portfolio generate income of £21.8m during January-March, up from £18.6m a year earlier. And promisingly, the firm commented that its investment adviser “continues to make good progress in developing its pipeline of investment opportunities,” a promising sign for earnings and dividend expansion.

The City expects 3i Infrastructure to increase an anticipated 7.3p-per-share dividend for the year ended March 2016 up to 7.5p in the period to March 2017, resulting in a chunky 4.5% yield. And a projected 7.8p reward in 2018 drives the yield to a handsome 4.7%.

Space star

I reckon that real estate investment trust (or REIT) SEGRO (LSE: SGRO) is also a scintillating stock selection thanks to improving conditions in the UK and on the continent.

SEGRO specialises in ‘big box’ logistics sites as well as urban distribution and light industrial warehouses, its portfolio benefitting from structural growth in hot areas like e-commerce. Indeed, the quality of the firm’s property portfolio saw vacancy rates fall to just 4.8% in 2015, the lowest level for well over a decade.  

The number crunchers expect SEGRO to shell out a dividend of 16.1p per share for 2016, yielding a terrific 4%. And the yield moves to 4.2% for next year thanks to predictions of a 16.6p reward.

Media mammoth

Shares in business information and media group Centaur Media (LSE: CAU) have moved steadily lower since the autumn,  a situation that makes the company a top-level value selection in my book.

The business announced last month that it had made an “encouraging” start to the year, and is aiming to deliver revenues growth of 5% in 2016. Indeed, Centaur Media’s rising focus on the high-quality digital paid-for content and live events markets should deliver resplendent top-line expansion well beyond this year, in my opinion.

City brokers expect Centaur Media to deliver a 3.2p-per-share dividend in 2016, yielding an eye-watering 6.2%. And an anticipated payout of 3.4p for next year pushes the yield to a brilliant 6.6%.

Recruit a dividend great

With earnings at recruitment specialist SThree (LSE: STHR) expected to speed relentlessly higher from this year onwards, the Square Mile unsurprisingly expects the business to get dividends chugging higher once more

SThree announced that gross profit cantered 10% higher during December-February, with double-digit growth across its ICT and Life Sciences divisions offsetting continued weakness across its oil and gas-related activities. On top of this, SThree is expanding its presence in the strong North American market to deliver sterling returns.

Against this backcloth, the City expects SThree to lift a long-running dividend of 14p per share to 14.4p in the year to November 2016, and again to 14.8p in the following period. Consequently the stock boasts exceptional yields of 4.6% and 4.8% for these years.

The post Can You Afford To Miss These 4 ‘Secret’ Dividend Stars? appeared first on The Twelfth Magpie.

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Royston Wild 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.