A brilliant bet

William Hill (LSE: WMH) is up against it right now. The bookmaker suffered an eye-watering profits fall last year as it suffered from fresh regulatory action in the UK and the reduction of maximum stakes on fixed-odds betting machines.

It’s going to take some time for the FTSE 250 to adjust to these changes and the lost revenues from its money-spinning machines. It’s why City analysts are expecting another big bottom-line drop (by 48%) in 2019.

On the plus side, though, it could be argued William Hill’s low forward P/E ratio of 14.6 times bakes in these troubles. And given the company’s longer-term outlook remains strong, underpinned by the international rollout of its online operations, and in particular its drive into the US, I reckon this makes it a great value pick.

City analysts expect earnings growth to return in 2020 and that William Hill can therefore afford to keep paying big dividends in the meantime. This means that the dividend yield for this year sits at a princely 5.6%.

Poised to jump?

Tyman (LSE: TYMN) has proved itself to be a great dividend grower over the past half a decade, thanks to solid and sustained profits growth over that period.

It’s hardly front page news that City analysts, in forecasting extra bottom-line progress through to the close of next year (a 7% rise is predicted for 2019), are also expecting shareholder payouts to keep rising through this period too. And for this year this leaves a big 5.1% yield.

The investment community remains reluctant to buy the door and window component manufacturer because of the poor condition of the US newbuild market. But with home loan conditions there improving of late, it’s possible that Tyman’s end markets will begin to improve, giving room for its share price to surge again.

The small-cap’s low prospective P/E multiple of 8.6 times could provide further ammunition for bouts of fresh buying activity too.

One last great buy

My final selection is Charles Taylor (LSE: CTR), a splendid momentum stock which offers a chunky 5% forward yield. The professional insurance services provider is expected to endure a small earnings reversal in 2019. But thanks to its strong long-term outlook it’s predicted to keep lifting dividends.

Charles Taylor’s profits might have been pummelled by a series of exceptional costs last year but the pain it endured should go some way to help it achieve its long-term objectives.

Acquisitions made in the last year include those of claims services specialists FGR of Chile and Aasgard Summit in the US, moves that help the small-cap in its quest to become “a joined-up claims services business with global scale.” And its presence in Latin America was given an almighty boost with the purchase of technology and software giant Inworx too.

At current prices, Charles Taylor boasts a prospective P/E ratio of 9.2 times. In light of its exciting growth strategy, I would consider the insurance services star far too cheap right now and therefore an exceptional buy.

The post 3 embarrassingly-cheap dividend stocks (with 5% yields) I’d buy today appeared first on The Twelfth Magpie.

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• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

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.

For this piece I’ve picked out a cluster of lesser-known shares whose long-term outlook remains just as compelling. Take a look, they could make you a fortune!

Insurance services star

Small-cap Charles Taylor’s (LSE: CTR) latest financials released this month may have prompted fresh selling, but I believe that market-makers may have been a bit hasty in their actions.

Sure, news of a 95% pre-tax profit drop from January to June was a shocker, but this was a reflection of one-off costs including charges relating to acquisitions and office moves. I’m more interested in the announcement that revenues blasted 21% higher to £123.4m in the first half, a result that shoved adjusted profit before tax 10% higher to £8.5m.

The result was encouraging enough to prompt Charles Taylor, which provides professional services to the insurance industry, to raise the interim dividend to 3.48p per share. City analysts think that the full-year dividend will rise to 11.7p per share, a figure that yields a fatty 4.7%. With the business strengthening through M&A to bolster its global footprint, I am confident that dividends should keep on barging higher along with profits.

Build a fortune

Building materials giant Costain Group (LSE: COST) is also a business that has been lifting dividends at quite a pace in recent weeks.

The infrastructure specialist raised the half-time dividend by 8% on the back of August’s sunny financial update, to 5.15p per share. Revenues ducked 12% between January and June to £772.9m on the back of “a lower level of large capital project activity” at its Infrastructure division. But this could not stop underlying pre-tax profit rising 17% to £21.4m to reflect the work Costain is undertaking to boost margins.

Investors need not worry about the sales drop-off in the first half either because its order book remains strong. According to the small-cap it boasted a “higher quality order book” of £3.7bn as of June, nine-tenths of which related to repeat business.

City brokers believe Costain will have the strength to raise the dividend to 15.5p per share this year. And this results in an inflation-mashing 3.7% yield.

A clear view

Tyman (LSE: TYMN) has proved to be a dream for investors seeking dividend growth in recent years, the manufacturer of door and window parts having almost doubled the annual payment during the past half a decade.

I’m confident that its major exposure to the strong trading territories of North America and Europe, allied to its growing footprint in the emerging markets of Asia and Africa should keep both profits and dividends growing at quite a rate as well.

And City brokers share my optimistic take, an anticipated 12p per share reward yielding a not-too-shabby 3.4%. With Tyman also having the financial strength to embark on additional earnings-boosting acquisitions I am confident that the small-cap should also prove a lucrative investment in the years to come. Just this month its SchlegelGiesse arm splashed out on Italian door-and-window-handles-and-accessories manufacturer Reguitti, along with its sister brands Tropex Design and Jatec, to boost its product portfolio still further.

The post 3 unknown but amazing dividend growth stocks I’d buy now and hold for a decade 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.

The stock was last 6% lower on the day and dealing at three-month lows after advising that it had incurred a £3.6m pre-tax loss during October-March, reflecting the ongoing restructuring at its Property Services arm.

Despite these troubles, Lakehouse’s release was mostly reassuring, suggesting that today’s sell-off is a tad overdone. The Essex business advised that “we expect trading for the full year will remain in line with management expectations and aim to finalise the operational improvement process within Property Services during the second half.”

Indeed, there was many positives to take from today’s release. Lakehouse declared that “the core businesses of Compliance, Energy Services and Construction all performed well, posting underlying double digit EBITA growth.” Revenues across these divisions shot 14% higher during the first six months, the business announced.

And Lakehouse’s order book clocked in at a solid £580m as of March, up 7% year-on-year thanks to £267m worth of new business.

Fiery forecasts

The City expects Lakehouse’s bottom line to endure another hefty hit following last year’s 62% drop — a 23% decline is currently anticipated for the 12 months ending September 2017.

Still, such profit problems are not expected to dent Lakehouse’s progressive dividend policy. A 2p per share reward is estimated for this year, up from 1.5p in fiscal 2016 and yielding a mighty 4.5%. And the yield strides to 5.7% for next year thanks to an anticipated 2.5p dividend.

Predicted dividends are covered two times by predicted earnings in the 2017, bang on the widely-regarded safety benchmark. And for next year coverage moves to an improved 2.1 times.

And the number crunchers expect earnings at Lakehouse to start moving in the right direction with a 30% advance next year. So while the business may be suffering some trouble right now, I reckon today’s weakness may prove a great time to latch onto the company’s promising turnaround plan.

Hard work pays off

Charles Taylor (LSE: CTR) is another great London-based dividend stock that could help you make a fortune.

For 2017 the firm is expected to pay an 11p per share dividend, up from 10.5p last year and yielding 4.6%. The good news does not cease there either, an 11.6p reward chalked in for 2018 yielding a terrific 4.9%.

Investors should be pretty confident in Charles Taylor meeting these generous projections too. A modest 1% earnings rise this year is enough to cover the dividend twice. And an estimated 5% bottom-line push for 2018 keeps coverage around this figure.

Charles Taylor’s share price has failed to move seriously skywards since March’s bubbly full-year release, and I reckon this provides an opportunity for eagle-eyed investors to pile in. The insurance-sector staffer advised back then that revenues soared 18.1% during 2016, to £169.3m, a result that powered adjusted pre-tax profit 4% higher to £14.8m.

And I fully expect it to keep on impressing. The business has spent huge sums on diversifying by both sector and geography via organic investment and M&A, including splashing out £30m last year on CEGA Group, which gives it a major leg-up in the technical medical assistance and travel claims management segment.

These moves should provide the foundation for exceptional earnings growth in the years ahead, in my opinion, and with it the facility for dividends to keep mashing the market average.

The post 2 massive yielders that could make you stinking rich appeared first on The Twelfth Magpie.

More reading

• With a yield of 6.8% and a P/E ratio of 12.1, is this a dirt cheap FTSE 250 stock to consider?
• Will SpaceX, Nvidia, or Alphabet be the first $10trn stock?
• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

Royston Wild 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.

Demand has been boosted by its interims of late August. The company — which provides professional services to the insurance sector — advised that revenues advanced a chunky 7% during January-June to £74m. The result propelled pre-tax profit 4.2% higher, to £6m.

And last month’s results provided further encouragement to income chasers. Charles Taylor saw net cash leap an eye-watering 80.6% in the first half, to £3.3m, prompting the firm to hike the interim dividend 5% to 3.15p per share.

With recent acquisition activity and new product launches helping to drum up business, the City expects Charles Taylor to enjoy earnings growth of 7% and 13% in 2016 and 2017.

Consequently Charles Taylor is anticipated to hike the full-year payout from 10p per share in 2015 to 10.4p this year and 11p in 2017. These projections yield a handsome 3.5% and 3.7% respectively, while dividend coverage for these years rings in at an exceptional two times and 2.2 times.

I believe the financial play is a great selection for those seeking reliable payout growth year after year.

Jobs giant

Recruitment giant SThree (LSE: STHR) hasn’t enjoyed the same share price success of Charles Taylor in recent times, however.

Concerns over the Brexit impact on SThree’s revenues have caused the stock’s value to slide 29% since June’s referendum. And mixed financials released today add some fuel to these fears.

SThree announced that total gross profit dipped 2% in the three months to August, to £66m, with profits in the UK falling 9% year-on-year. The recruiter blamed a slowdown in the banking and finance sector, as well as the result of the summer’s EU vote, in denting performance at home.

And SThree also encountered troubles in the US. Gross profits here sank 10% from the corresponding 2015 quarter as the firm’s financial and energy units struggled. But on the plus side, SThree’s strong momentum in Continental Europe continued, and gross profits here surged 12% during June-August.

Chief executive Gary Elden remains bullish over SThree’s outlook, commenting today that “the continued momentum of our Contract business, the strength of our performance in Continental Europe and the benefit of restructuring measures taken earlier in the year, leave us well-positioned for our seasonally most significant fourth quarter.” And expectations for the full-year remain intact.

The number crunchers have confidence that SThree can ride out ay near-term troubles — earnings dips of 2% and 8% are pencilled-in for the periods to November 2016 and 2017 respectively — and keep paying out generous dividends, particularly as the firm’s debt pile is falling and its pan-global presence provides plenty of long-term growth potential.

As such, rewards of 14.1p and 14.3p per share are expected this year and next, figures that yield 5.6% and 5.7%.

The post 2 ‘secret’ dividend stars you can’t afford to miss! appeared first on The Twelfth Magpie.

More reading

• With a yield of 6.8% and a P/E ratio of 12.1, is this a dirt cheap FTSE 250 stock to consider?
• Will SpaceX, Nvidia, or Alphabet be the first $10trn stock?
• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

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.

From banking giant Barclays and engineer Rolls-Royce through to mining play Rio Tinto, a spate of FTSE 100 stocks have been forced to slash their dividends in light of battered balance sheets and worrisome earnings outlooks.

With this in mind, I’ve scoured the FTSE Small Cap (INDEXFTSE: SMX) for a cluster of alternative stock stars that are a great bet to keep on delivering bumper dividend flows.

Space saver

Bolstered by strong domestic demand for its industrial, retail and office space, I believe A&J Mucklow Group (LSE: MKLW) is in terrific shape to keep its progressive dividend policy chugging higher.

With the City expecting solid earnings growth in the near-term and beyond, Mucklow is anticipated to fork out a chunky 21.5p per share dividend for the year to June 2016, throwing up a 4.7% yield. And a predicted 22.1p reward for 2017 drives the yield to an impressive 4.8%.

Services star

With demand from the insurance segment striding higher, I reckon professional services provider Charles Taylor (LSE: CTR) should also keep growing dividends at a terrific rate. And on top of generating terrific organic growth, the firm’s ambitious acquisition strategy should light a fire under shareholder returns too.

Its progressive dividend policy having been resurrected in 2014, the number crunchers expect Charles Taylor to pay a dividend of 10.4p per share this year, creating a meaty 3.7% yield. And the yield marches to 3.9% for next year thanks to a predicted 10.9p payment.

Keep on trucking!

Logistics play Stobart Group’s (LSE: STOB) decision to diversify away from its traditional haulage business continues to deliver the goods, its Aviation, Rail and Energy divisions reporting further breakneck growth in 2015. And in a further boost for income chasers, the company’s ongoing disposal drive is also creating plenty of cash to keep producing generous payouts.

The transportation play has kept the dividend locked at 6p per share for donkey’s years now, and the City doesn’t expect this to end in the near future. However, income seekers should sit up and take note of a juicy 5.3% yield lasting right through to the 12 months ending February 2018.

Media mammoth

Despite current market difficulties, I reckon camera and lighting specialist Vitec Group’s (LSE: VTC) renewed investment in high-growth segments should help it navigate the worst of these travails and deliver splendid long-term returns.

On top of this, Vitec Group is also bolstering its earnings prospects through a steady stream of product releases. In light of these moves, the calculator bashers expect Vitec’s progressive dividend policy to churn out a 26.3p per share reward in 2016, creating a market-mashing 4.8% yield. And an estimated 26.6p payment nudges the yield to an even-better 4.9%.

The post The 4 ‘secret’ dividend stars you can’t afford to miss! appeared first on The Twelfth Magpie.

More reading

• With a yield of 6.8% and a P/E ratio of 12.1, is this a dirt cheap FTSE 250 stock to consider?
• Will SpaceX, Nvidia, or Alphabet be the first $10trn stock?
• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended Barclays and Rio Tinto. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.