The two factors that have most caught my eye about the company is an attractive valuation with its shares trading at around 34% below net asset value (NAV) and a 4.8% dividend yield that has few peers in the FTSE 100. Of course, these attractive metrics would mean nothing if a downturn were right around the corner, but British Land so far shows few signs of slowing down.

NAV did fall marginally last year from 919p to 915p year-on-year (y/y), but this was due mainly to reduced property valuations. Encouragingly, this looks to be mostly a knee-jerk reaction to the Brexit vote as prices rebounded a solid 1.6% in H2. Furthermore, its focus on creating attractive multi-use retail and commercial locations is paying off handsomely. Footfall is well ahead of rivals leading to sky-high 98% occupancy rates at year-end and like-for-like rental income growth of 2.9% across the portfolio.

Increased rents helped boost underlying operating profit by 7.4% y/y to £390m. This allowed for a 3% increase to dividends as well as a reduction in leverage with the headline loan-to-value ratio falling from 32.1% to 29.9% y/y. On top of the increased dividend, management is also moving forward with a £300m share buyback programme. That’s because it wants to close the huge gap between share price and NAV, as well as seeing buybacks as a better use of cash with property values as elevated as they are.

With its shares as cheap as they have been in some time, massive shareholder returns on tap and impressively resilient operations, I reckon now could be a great time for contrarian investors to take a closer look at British Land.

Turning empty land into big profits

Another property firm that’s caught my eye is brownfield land regeneration expert Harworth Group (LSE: HWG). The company’s focus is redeveloping former industrial land into plots for commercial and housing purposes with a focus on the Midlands and North of the country.

So far these sites have proved impervious to Brexit-related fears due to constrained housing supply and continued demand growth for out-of-town commercial units. In the half to June, an increase in underlying profits and uplift in property valuations led to a 13.2% y/y rise in NAV to 117.4p.

Looking ahead, the company’s prospects appear quite bright as it is moving along nicely with normal disposals of developed property and is still finding plenty of new brownfield sites to develop in the future. And with a loan-to-value ratio of just 2.5% at period end, the company is very well placed to both continue buying new sites and survive any potential downturn.

Harworth’s annual dividend yield of 0.78% won’t attract any income investors but with good growth prospects, low debt levels and its shares trading at a 13% discount to their NAV, I see many worse options out there in the property sector.

The post One unloved FTSE 100 dividend star I’ve got my eye on appeared first on The Twelfth Magpie.

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Ian Pierce has no position in any of the shares mentioned. The Motley Fool UK has recommended British Land Co. 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.

Going for growth

Today’s full-year results describe Informa’s commitment to a growth agenda, expressed in the firm’s Growth Acceleration Plan, which the directors say has delivered three consecutive years of growth in revenue, adjusted earnings, free cash flow and dividends.

Indeed, the headline figures are encouraging with revenue up 11% compared to the year before, adjusted operating profit rising almost 14%, and adjusted diluted earnings per share rising by nearly 7%. The directors topped off these good figures by hiking the dividend 4.3%, which strikes me as a good sign that they are optimistic about the firm’s forward prospects.

Chief executive Stephen A Carter reckons 2016 was “steady and strong” for Informa and the business grew on all key financial measures, while expanding in the US and investing in its products, which sets it up for further progress during 2017. He expects the firm’s recent acquisition of Penton to help propel accelerated change in earnings growth during 2017.

Last year, North America was Informa’s largest market delivering 46% of revenue. Meanwhile, 16% came from continental Europe, 11% from the UK and 27% from the rest of the world. I think Informa’s organic and acquisitive approach to international expansion could drive further growth from here, which makes the stock interesting and worth further research.

Creating value

Last year, Harworth saw its net asset value grow by 12.5%, operating profit ballooned by 21% including value gains, and earning per share increased by nearly 13%.

According to chief executive Owen Michaelson, the strong results are down to the firm’s focus on maximising the value of its strategic land bank while at the same time growing its income with new lettings and acquisitions. Mr Michaelson points to the increase in value achieved with the company’s flagship North West site, Logistics North in Bolton, as a prominent performer in the firm’s portfolio. He reckons market fundamentals in the firm’s operating regions are strong, which should marry with the company’s strategy to create value and drive further strong business performance during 2017 and beyond.

Harworth’s operating model is interesting. It regenerates brownfield sites and invests in property, owning and managing a portfolio of 22,000 acres of land on more than 140 sites, many of them related to former coalfields. Its redevelopments include employment areas, new residential developments and low carbon energy projects. I think the firm plays a useful role and it’s pleasing to see the company going about its business profitably.

Fair value and growth potential?

At today’s share price around 680p, Informa trades on a forward price-to-earnings (P/E) ratio of 13.4 for 2018 and the forward dividend runs at 3.2%. City analysts following the firm expect earnings to cover the payout just over 2.3 times.

Meanwhile, at 97p, Harworth’s dividend runs around 0.8% and the firm’s price-to-tangible net-asset-value figure comes in at around one. The dividend might be small, but the directors are committed to a progressive dividend policy. Both firms look like they are trading around fair value to me, yet both have potential to make sound operational progress from here.

The post FY results reveal growth potential at Informa plc and Harworth Group plc appeared first on The Twelfth Magpie.

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Kevin Godbold 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.